Cryptocurrency CoinLoan, a platform that offers backed loans, announced in a statement that it has temporarily lowered the withdrawal limit for lenders due to the current market turmoil.
Excess Money Withdrawals Over CoinLoan Due To The Decline In The Crypto Money Market And The Companies Experiencing Collapse
CoinLoan, a European cryptocurrency lending company, has become the latest company to restrict withdrawals due to various financial difficulties. CoinLoan noted that issues affecting companies like Celsius, Voyager, BlockFi, and Three Arrows Capital have triggered a wave of withdrawals on its platform.
In its announcement on the subject, the company said:
“The interest we pay on Interest Accounts is obtained by giving over-collateralized loans to other platform users. Therefore, in some cases, the estimated date of complete withdrawal of assets from the Interest Accounts occurs before, rather than after, loan closing.”
For this reason, the company has implemented a withdrawal limit “to stabilize fund flows and avoid disruptions to liquidity.”
Customers are now limited to a maximum withdrawal limit of $5,000 per 24 hours as per today’s announcement.
CoinLoan has thus distanced itself from the epidemic of collapse spreading among crypto hedge funds and lenders. The platform added that its policies prohibit investing in “risky activities”, noting that Luna is not exposed to staked ETH or any of the firms affected by the crisis. CoinLoan also added that client funds are safe.
The bearish wave in the crypto market in bitcoin negatively impacted many companies. Tesla company, which is the CEO of the world’s richest person, Elon Musk, is expected to lose $ 440 million in BTC assets this quarter.
*Not investment advice.