Staking Service Freeway Points to Failed Strategy as Cause to Stop Withdrawals

Freeway, the crypto staking platform which suspended withdrawals recently, attributed the occurrence to failure of one of its cryptocurrency trading strategies, CoinTelegraph wrote. They also cited market conditions as a reason.

Unprecedented volatility

On October 23, Freeway announced it was suspending different transactions connected to Supercharger, a high yield investment product, pointing to “unprecedented volatility” at the time. They failed to provide further detail. The price of the Freeway token was soon in freefall.

Platform is working on new strategies

Users of Supercharger can get an annual yield of up to 43% by depositing crypto and fiat currencies in secure brokerage accounts. Their deposits are used to get returns.

Ultimately, Freeway decided to suspend purchases and deposits. Repurchase of Superchargers has also been halted pending implementation of new trading strategies.

The details of the suspension

Two days later, the crypto staking service tweeted that one of its trading strategies had apparently failed, with a drastic impact on the platform’s portfolio. Investors suffered a “substantial loss.”

The strategy failed due to crypto volatility and the unprecedented rise of the United States dollar. The service stated:

The trading strategy was executed as it was programmed, but the market volatility caused a spike in margin utilization leading to the loss.

In subsequent tweets, the platform shared it was working on a recovery plan to secure and improve the remaining assets.

Its plan involves improving asset management, a new Earn and Protect feature to improve use protection, bringing in experts to look for alternative portfolio diversification opportunities, and introducing a new, “impressively profitable” product.

No further details have been provided. Freeway also confirmed that they had abandoned their losing strategy.