Finblox Raises Withdrawal Limits, Explores Legal Action Against 3AC

Crypto staking platform Finblox is rolling back its withdrawal limits imposed earlier this month due to 3AC's potential insolvency.

Bishal Kumar Chanda2 min read
Finblox Raises Withdrawal Limits, Explores Legal Action Against 3AC

Crypto staking platform Finblox is rolling back its withdrawal limits imposed earlier this month due to 3AC's potential insolvency.

3AC faced a flurry of liquidations in June, incurring at least $400 million in losses from crypto firms. In an update on June 16, Finblox revealed that the hedge fund is one of its counterparties.

On the same day, Finblox imposed a $1,500 cap on monthly withdrawals. In addition, the crypto staking platform suspended staking rewards when Three Arrow Capital's financial woes first came to light.

Finblox CEO Peter Hoang said, "We are doing everything in our power to restore faith in our platform, unlock the access to the users' funds affected by this market event and complete the return to normal operations."

Since then, Finblox has sent "multiple demands" to Three Arrows Capital requesting full repayment of the entire loan. In fact, the platform is also seeking legal counsel on the recovery of funds.

Finblox raises withdrawal limits

Starting July 1, Finblox plans to boost its monthly withdrawal limit to $30,000, with daily withdrawals initially capped at $3,000. Furthermore, the firm plans to increase the monthly withdrawal to $500,000 and daily withdrawals to $50,000.

Additionally, the staking platform said it would restore its referral program rewards. Starting July 1, Finblox has also increased existing yields. It includes 4% on bitcoin, 4.3% on ether, 4.3% on USD Coin (USDC) and 3.9% on tether (USDT).

Finblox is now allowing users more access to their funds while its team continues to work with parties spurred by 3AC.

"Three Arrows Capital was considered blue-chip, and among the largest and most trusted players in the crypto lending space just a few weeks ago. It is a Lehman moment for the industry — no one is too big to fail," Hoang said.

Finblox is one of the many platforms hit by the market downturn and the subsequent downfall of Three Arrows Capital. Meanwhile, Finblox's rival Celsius has been facing a liquidity crunch of its own.

Earlier this month, Celsius paused withdrawals, swaps and transfers between accounts, citing "extreme market conditions." However, blockchain analytics platform Nansen recently reported significant improvement in the health ratio of Celsius' on-chain positions.

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