Several crypto platforms froze withdrawals this summer. Which have restored account access to their users?
In recent months, several cryptocurrency lending companies and other services have suspended withdrawals and frozen customer balances.
Those companies began to suffer from low liquidity when Bitcoin prices plummeted to levels near $20,000 in June. In order to regain solvency, each firm has been forced to redeem its investments or seek out new methods of funding.
Not every company has succeeded in remaining solvent, and some have entered bankruptcy proceedings or initiated a restructuring process. Still, many companies are attempting to pay back users through a recovery plan.
Below are the statuses of crypto companies that have halted withdrawals.
Babel Finance suspended withdrawals on June 17. Estimates at the time suggested that the company lost as much as $225 million through its investments.
According to Bloomberg, the company has plans to raise funds through its restructuring plan. Babel Finance intends to raise $250 million to $300 million through convertible bonds and gain a $200 million revolving line of credit.
Beyond that, the company has not announced any definite plans that will allow customers to withdraw funds from their account balance.
On June 12, Celsius became one of the first companies to suspend withdrawals. During its bankruptcy hearing in July, the company laid out a reorganization plan that will see it raise funds through asset sales, mining operations, and fundraising.
Under Celsius’ proposed recovery plan, users will be able to withdraw their balance in cash at a discount or make a long-term continued investment.
However, Celsius has not announced any definite process for users to recover their funds, and withdrawals on the platform remain closed as of Aug. 10.
CoinFLEX suspended withdrawals on June 23 and so far has managed to avoid filing for bankruptcy. It began to resume withdrawals in mid-July, at which time it permitted users to withdraw up to 10% of their balance.
To recover further, CoinFLEX is planning to raise funds by selling a recovery token, seeking out investors, and finding depositors willing to trade deposits for equity.
CoinFLEX is also entering arbitration in Hong Kong with crypto entrepreneur Roger Ver, who supposedly owes as much as $84 million to the company.
Hodlnaut is the latest crypto lender to suspend withdrawals The Singapore-based company announced its decision to pause services on Aug. 8.
The company added that it will halt swaps and deposits as well as withdrawals. Furthermore, it will withdraw an application from the Monetary Authority of Singapore (MAS) that would have seen it offer token payment services.
Hodlnaut said that it will provide an update on Aug. 19, but there is no indication that it will resume withdrawals and other services at that date.
Nuri, formerly known as Bitwala, filed for insolvency on Aug. 9. The exchange plans to keep withdrawals and most other functions open in spite of that decision. However, the exchange will not allow new accounts to be opened, nor will it accept new customers.
Vauld suspended withdrawals on July 4. Since then, it has filed for creditor protection under bankruptcy law, though it has not actually filed for bankruptcy.
Vauld is reportedly discussing restructuring options that would help it stay operational. Furthermore, the company has been exploring the possibility of an acquisition by Nexo since July, though the deal has not yet been confirmed.
Beyond that, Vauld has not announced any definite plans to return funds to its users.
Voyager Digital suspended trading on July 1 and filed for bankruptcy on July 6. However, the bankruptcy proceedings have progressed positively and the company has gained court approval that will allow it to return funds to customers.
Though it is disputed whether the company will be able to fully compensate users, Voyager Digital has laid out a clear plan for users to recover funds.
The company is now cleared to return $270 million to customers via special accounts in the Metropolitan Commercial Bank beginning on Thursday, Aug. 11.
Zipmex froze withdrawals on July 20. It later filed a number of moratoriums for bankruptcy protection on July 29 without filing for bankruptcy.
The company began to open withdrawals for Solana (SOL), Ripple’s XRP, and Cardano (ADA) the week of Aug. 2. Beginning on Aug. 11, users will be able to withdraw Ethereum (ETH) from the platform’s Z Wallet. Beginning Aug. 16, users will be able to withdraw Bitcoin (BTC) from the same wallet.
Zipmex says that it is working toward organizing the return of assets from Babel Finance. It also says that it is engaged in ‘advanced fundraising conversations” and that has received an additional investment into its ZMX token from an investor.
Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.