The Fall of Crypto Lenders

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The crypto market is yet to be balanced and while it’s still facing difficulty adjusting to the $20k mark crypto lenders are also facing difficulties adjusting to their current financial problem that they are experiencing due to the bear market. So many crypto lenders have fallen either daily or weekly because of the loss they experienced during the harsh bear market. Some are either pausing withdrawals, filing for bankruptcy protection or they are getting ready to be acquired by another company.

Despite the fact that crypto lenders don’t have a stronghold in the crypto industry, we can’t deny the fact that they have played some key roles in the crypto or DeFi ecosystem and the fact some are crashing or experiencing some problems we can’t also deny the fact that it’s going to leave a mark or hole in the crypto market or ecosystem. One of the crypto lenders that has hurt the crypto market or ecosystem due to its suspension of withdrawals is Celsius.

Last month we saw Celsius halt its operation due to the money they lost in the bear market which made them unable to attend to their users and since no solution has been provided to the problem they are facing and no assurance made if the users will ever get their money. Another crypto lender that’s going to hurt the DeFi ecosystem is Voyager. Voyager Digital earlier suspended trading activities on their platform last week and now just like Celsius, they have filed for bankruptcy protection.

The reason for the filing was because of the $650 million loans they lost to the crypto hedge fund Three Arrows Capital. The company has promised the users that they will allow them to have access to their account very soon but they will only receive some of their coins while they continue to recover the loan from Three Arrows Capital. Also, they have also assured their staff that despite the current issue on the ground, they will continue to receive their normal salaries.

Another crypto lender that’s on the verge of collapse that also suspended trading activities is Vauld which they did yesterday but Nexo another crypto lender plans to acquire them before they fully crash. It seems this is really a difficult time for crypto lenders but they are however trying to stay on course by allowing other crypto lenders that are capable to acquire them because it won’t be fair to allow users to forfeit all their assets in their wallet because of the problem they are facing.

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The fall of crypto lenders is a little surprising.

If people were borrowing and repaying in crypto; then the change in the price of cyrpto itself shouldn't have that dire an effect.

The problem, of course, is the deadly obsession with stablecoins and the tendency of investors to take out leveraged positions.

!PIZZA

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Well you have a point though. Well everyone just want a coin they can trust 😂 about being obsessed don't you think it's too much lol

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Hopefully, they will be able to be back on track. But right now as the markets are in all red, it will be a long shot for them to pay their customers.

Some are now in panic and stating to always keep their crypto within them and not rely on such mechanisms. !PIZZA

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