Algofi to Shut Down Despite Belief in Algorand’s Technology
Despite the developers’ belief in the strength of Algorand’s technology and novel consensus algorithm, Algofi, the borrowing and lending protocol built on decentralized finance blockchain Algorand, will soon shut down.
Starting Sept. 1, the collateral factors of ALGO, vALGO, STBL, USD Coin (USDC), goBTC, and goETH markets on both Algofi V1 and V2 will be reduced from around 80% to 0% by the beginning of December. In addition, the current Liquidity Mining programs will be “halted and no future proposals will be enacted.” The Algofi protocol had $25 million in total value locked at the time of publication, down from its $135 million peak in February.
The announcement comes after the U.S. Securities and Exchange Commission charged cryptocurrency exchange Bittrex with operating an unregistered exchange in the U.S. Algorand was one of six tokens deemed to be a security by the SEC. The SEC alleged the token’s security-like characteristics to be partly linked to Algorand’s initial coin offering in 2019.
On June 13, eToro, a cryptocurrency exchange, suspended trading of ALGO, MANA, MATIC and DASH for U.S. customers due to the “rapidly evolving regulatory landscape.” The Securities and Exchange Commission (SEC) has identified 68 cryptocurrencies as securities.
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