- CoinLoan said that the safeguards would only be in place for a short period of time.
- The previous maximum withdrawal limit was $500,000 a day.
Currently, CoinLoan has a daily withdrawal limit of $5,000, a 99 percent drop from its former maximum. An increase in money withdrawals necessitated the company’s implementation of the adjustment.
Yet Another Firm Joins the Group
Today, a new daily withdrawal restriction of $5,000 per user has been introduced, compared to the previous maximum of $500,000 a day. However, CoinLoan said that the safeguards would only be in place for a short period of time.
While CoinLoan bragged of being “probably the only company unaffected” by recent stablecoin failures, hedge fund wipeouts, or liquidity concerns on key protocols, it claimed that the “turmoil” generated by crypto companies who were affected had now led to a “spike in withdrawals of assets from CoinLoan.”
The corporation referred to the increased withdrawal restriction as a “precaution” to prevent “liquidity-related interruptions.” However, it recognized that freezing all withdrawals would have been “more convenient” from a commercial standpoint, claiming that the present level of liquidity was adequate to satisfy all consumer demands.
CoinLoan is one of the crypto market’s earliest “CeFi” platforms. Using decentralized finance (DeFi) protocols, CeFi is a word used to describe centralized businesses that can generate substantial returns.
On a growing list of big participants in the crypto finance industry, CoinLoan joins Celsius and BlockFi in having liquidity concerns due to the protracted decline in crypto markets and the bankruptcy of multi-billion dollar crypto hedge fund Three Arrows Capital. While major crypto trading company Alameda Research granted Voyager a $600 million loan, the exchange suspended withdrawals from its platform.
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