Yield App Suspends Operations Citing Portfolio Losses Linked to FTX Collapse
Yield App Ltd, a Seychelles-incorporated crypto investment platform, has announced the immediate suspension of all operations on its digital wealth platform, yield.app.
This move comes as the company prepares to enter liquidation proceedings and aims to ensure fair and equal treatment for all users and stakeholders.
Yield App Stops Operations
The decision, effective today, was shared in an official statement through a post on X. Yield App Ltd, a Seychelles-incorporated limited liability company, is today, Friday, 28 June 2024, announcing the suspension of all activity on the digital wealth platform http://yield.app as the company prepares to enter liquidation proceedings, said the statement.
Suspension of platform activity ahead of liquidation proceedings
28 JUNE 2024, 04:15 UTC: Yield App Ltd, a Seychelles-incorporated limited liability company, is today, Friday 28 June 2024, announcing the suspension of all activity on the digital wealth platform
Yield App (@YieldApp) June 28, 2024
The suspension follows significant portfolio losses incurred through third-party hedge fund managers who had custody of Yield App assets on the now bankrupt cryptocurrency exchange FTX. These hedge funds are also involved in ongoing litigation.
Effective immediately, all activities on Yield Apps platform will stop as the company consults with liquidators. Community channels will also be suspended, although a support channel will remain accessible through the yield app to assist users during this transitional period.
Yield App has requested patience from its customers, assuring them that further information, including detailed FAQs, will be provided as soon as possible.
The announcement got mixed reactions from the crypto community. One user expressed disbelief, saying, I cant believe it. I thought you would survive the bear market and make a strong comeback. Why give up now when the bull market is only halfway through?
Another commented, Im glad I withdrew my bitcoin a few months ago. Overall, the sentiment was one of shock, with many X users simply asking, What? Another user remarked, Whats going on? This must be a joke.
Yield Apps Transparency Questioned
The announcement has raised concerns regarding Yield Apps transparency, particularly in light of previous reassurances about its exposure to FTX.
In a Discord message dated November 10, 2022, Yield App CEO Tim Frost assured users that the firm had no significant exposure to FTX. This statement has come under scrutiny following todays revelations.
The liquidation of Yield Apps assets occurs amidst a broader context of FTXs bankruptcy proceedings. The failed exchange has been actively liquidating assets to settle its disputes. In 2024 alone, FTX sold 8% of its stake in the AI firm Anthropic, offloaded its European arm for $33 million, and planned the sale of Digital Custody for $500,000.
The collapse of FTX has had severe repercussions for several firms. Last year, Galois Capital, a hedge fund founded by Kevin Zhou, closed its flagship fund due to substantial exposure to FTX. The fund lost nearly half of its capital when FTX collapsed.
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Text source: CryptoPotato
