Yield App Ceases Operations Following Portfolio Losses Linked to Collapsed Crypto Exchange FTX
Summary:
Seychelles-based cryptocurrency investment platform, Yield App, has announced the immediate cessation of its operations. The decision was prompted by portfolio losses linked to third-party hedge fund managers who held Yield App assets on the failed cryptocurrency exchange FTX. Previous statements from the company, however, had assured users of no significant exposure to FTX, leading to questions around the company's transparency. Meanwhile, FTX continues its asset liquidation process following bankruptcy, with multiple sales of claims and assets throughout the year.
Yield App, a cryptocurrency investment enterprise based in Seychelles, revealed on June 28 that it would cease all activities on its platform immediately. The official communication explained that they chose to do so to guarantee equitable treatment for all users and stakeholders of Yield App. This decision was made after recognizing portfolio losses resulting from third-party hedge fund managers, who maintained assets of Yield App on the failed cryptocurrency exchange FTX and are now involved in pending lawsuits.
Details for Investors
Yield App has reportedly experienced portfolio losses as a consequence of third-party hedge fund managers retaining Yield App's assets on the now-defunct FTX exchange, leading to ongoing legal disputes. Despite the suspension of community channels, the Yield App public help channel will stay available via the official site. Yield App representatives were contacted by Cointelegraph to obtain additional details but no reply was received before this article was published.
Confusion over FTX links
Despite Yield App's recent announcement, prior communications from the company have raised questions about its transparency regarding its possible vulnerability to the failure of FTX. In a message on Discord from Nov. 10, 2022, Yield App's Tim Frost reassured users that the company had "no significant exposure to FTX." However, an anonymous source conveyed bafflement at the situation to Cointelegraph, questioning why they were affected by FTX's downfall two years on from the event.
FTX liquidation continues
The bankrupt cryptocurrency exchange has experienced a number of claim and asset sales this year, and resolved numerous disputes. FTX divested 8% of its share in AI company Anthropic, sold its European unit for $33 million, and arranged the sale of Digital Custody for $500,000, all in February. The ongoing asset liquidation is indeed a part of its bankruptcy proceedings.
Published At
6/28/2024 1:42:27 PM
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