The withdrawal limit for traders has been temporarily lowered by cryptocurrency-backed loans provider CoinLoan. The corporation cited the present market crash as the reason for the decision.
Due to the change, customers are now limited to a $5,000 maximum withdrawal limit each day.
In their announcement, they noted the following: “the interest we pay on the Interest Accounts is yielded by issuing overcollateralized loans to other platform users. Hence in some instances, the estimated date of a complete withdrawal of assets from the Interest Accounts comes before, not after, loan closure.”
The company cited “balance the flows of cash and minimize liquidity-related disturbances,” as a reason for the withdrawal restriction.
Following the current market turmoil, CoinLoin joins a number of high-profile crypto firms that have recently limited withdrawals due to different sorts of financial difficulty. The European crypto lender’s limitation of withdrawals is the most recent example of this.
According to CoinLoan, a surge of withdrawals has been brought on by the problems that Celsius, Voyager, BlockFi, and Three Arrows Capital have encountered.