Entangled Crypto Yield Platform Offers Unclear “Recovery Plan”

Yield strategy platform Freeway has shed some light on its rationale behind the suspension of services earlier this week.

On October 26, the freeway posted an update explaining why it took action. Earlier this week, the DeFi Yield platform suspended its services, citing unprecedented volatility in the crypto markets.

The firm blamed a failed trading strategy for “incurring substantial losses due to unpredictable market volatility”. It added that the rapid depreciation of the dollar has compounded the problem.

According to the freeway, that instability led to “increased margin usage that caused losses”.

It stated that the specific strategy was used in its Beta Earn and Protect product and had a stop loss.

freeway recovery plan

Trading losses dramatically affected Freeway’s portfolio. However, steps were taken to secure the remaining collateral. Freeway did not give details of the amount or assets, but the firm said it had already fallen out of the losing strategy.

Freeway is running several recovery plans. It also hired third party consultants to assist. The first plan is to manage and develop existing funds; Again no details were given. The second plan includes diversification, and the third plan involves “deployment of major new funding in an entirely new product with impressive projected profitability.”

Axie Infinity Price Prediction Slowdown Freeway FWT

The plans were very vague and no details were provided for the customers who are now in limbo. Still, it warned that things would not be quick.

“We need to be in a position to execute safely in order to resume the Supercharger buy-back. So we would need to see significant intrusions into the damage before that could happen, and that would take time.

Freeway Eleven Crypto offers “Supercharger” trading strategies that it claims can yield up to 43%. Clients can buy strategies with crypto collateral and sell them back to Freeway. However, on 23 October he announced that he was no longer buying them back, prompting speculation that the rug was pulled.

No recovery for native token

The platform’s native token, FWT, has shown no signs of recovery since the suspension notice. According to CoinGecko, it was trading flat at $0.0015 at the time of writing.

The FWT has registered a decline of around 80% prior to the announcement when it was trading at around $0.0070. Furthermore, the battered coin is now down 95% from its May 2021 all-time high.

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