Key Takeaways
- The Midas DeFi Portfolio lost $50 Million of its $250 million in assets under management.
- The firm now plans to pivot its businesses into centralized, decentralized finance (CeDeFi).
- Midas lost around $58.5 million to variousDeFi-related security breaches and overpaying interest in its native MIDAS token.
Crypto platform Midas Investment to shut operations owing to asset deficit losses it incurred in 2022.
“Based on this situation and current CeFi market conditions, we have reached the difficult decision to close the platform,” said Midas CEO Iakov Trevor Levin.
According to his official statement, the Midas DeFi Portfolio lost $50 Million of its $250 million in assets under management. He added that following the collapse of Celsius and FTX, its platform experienced more than 60% of AUM being withdrawn.
As of December 27, Midas’ total liabilities were $115 million in Bitcoin, Ethereum, and stablecoin. However, the platform holds around $51.7 million of these assets, creating an asset deficit of $63.3 million.
Commenting on the asset deficit, Lakov said, “The asset deficit was caused by the long-term risk of DeFi investment, the instability of our business model after the loss of assets, and the illiquidity of the Midas token.”
On top of this, the platform further lost $58.5 million to various DeFi-related security breaches and overpaying interest in its native MIDAS token.
Talking about future plans, the Midas CEO stated that the firm plans to pivot its businesses into centralized, decentralized finance (CeDeFi). “This project will be fully transparent, on-chain, and built with the goal of offering a new and improved investment experience.”
The new business would integrate with the MIDAS token, which has suffered a 99% decline in the wake of the Midas.Investments shutdown. CEO stated that the platform would rebalance its users’ accounts by deducting 55% from it and their rewards earned, allowing users to withdraw around 45% of their assets.
He added that users whose balances are less than $5000 would have only their earnings deducted, while all users can immediately withdraw the remaining amount in their wallets. The CEO further noted that the adjustments would be compensated in MIDAS tokens which can later be swapped in for tokens of Midas’ new project.
