Crypto Crash Prompted These Companies To Freeze Withdrawals

The crypto crash in June 2022 prompted crypto companies to freeze withdrawals. Although some have already resumed withdrawals following the crash, some investors are left wondering if they will ever see their money again. Here are the nine companies that froze withdrawals.

Babel Finance

Babel Finance was one company that was forced to freeze withdrawals following the crypto crash. They issued a temporary suspension of withdrawals in late June 2022. They had to freeze withdrawals due to fluctuations and liquidity pressures. However, Reuters reported days later that Babel Finance repaid debts to its investors.

Binance

Binance had put a halt in their withdrawal for hours on June 13, following Celsius’ move. They had to stop the withdrawals momentarily due to withdrawals getting stuck because of low transaction fees. Investors were lucky they could withdraw their money the next day. Plus, Binance seems like the crypto crash didn’t hit them like its other competitors. In fact, they announced they’re planning on hiring more people.

Celsius Network

Many crypto investors will know that Celsius Network was one of the first to freeze withdrawals during the crash. It started freezing withdrawals and transfers on June 13 and has yet to lift the withdrawals.

The June crash wasn’t the first time Celsius was embroiled in controversy. It was reported that Celsius had higher interest rates, up to 18%. 

However, Celsius has filed for bankruptcy following the crypto crash.

Coin Flex

CoinFlex followed Celsius and Binance ten days after the two companies mentioned above had frozen their withdrawals. They cited uncertainty and market conditions as reasons for the freeze. CNBC even reported that CoinFlex owes a $47 million debt to one of its investors. It remains unclear when CoinFlex will resume withdrawals since their latest update on the matter was on June 30, 2022.

CoinLoan

CoinLoan didn’t freeze withdrawals but reduced the daily withdrawal from $500,000 to $5,000. Daily withdrawal limits remain at $5,000 until further notice.

Three Arrows Capital

Due to Voyager owing Three Arrows Capital over $600+ million in bitcoin, they were forced to go into liquidation. It spells trouble for Three Arrows Capital because its assets would be divided among its creditors. They’re one of the unlucky ones following the crypto crash.

Vauld

Vauld suspended transfers, deposits, and withdrawals on July 4, 2022, and it’s still ongoing. The platform is facing financial difficulties and has cited market volatility for the suspension. In addition, more users have emptied their accounts on the platform since June 12, 2022.

Voyager

Voyager is one of the companies that didn’t suspend withdrawal but reduced withdrawal limits like CoinLoan. Unlike CoinLoan, they cut daily withdrawal limits from $25,000 to $10,000. They had decided on this withdrawal limit after defaulting to Three Arrows Capital. Voyager still owes them $600+ million of bitcoin.

Unfortunately for Voyager, they filed for bankruptcy and stopped trading. But since they filed bankruptcy under file 11, this buys them time to reorganize, which won’t trouble their creditors in the future. 

WazirX and CoinDCX

Nischal Shetty, CEO of WazirX, said in an interview on CNBCTV18 that inflation and interest rates have been why they suspended withdrawals on their platform. Like WazirX (minus the CEO statement), CoinDCX also momentarily halted withdrawals.

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