SALT Returns: One of the First Crypto Lending Platforms is Back
SALT Lending, one of the world’s first crypto lending platforms had to cease its deposits and withdrawals last year in November
SALT has declared that it has been able to close a new round of funding for $64.4 million in exchange for company equity
With time, regulations are the only way to safeguard the investor’s security and incite the required trust in the crypto industry.
The last year had been terrible for crypto lending platforms with an
Extreme liquidity crunch in the market. Be it Voyager Digital, Celsius, BlockFi, or Genesis, none of these crypto-lending platforms could survive the backlash of some extreme market collapses.
However, one of the crypto lending platforms that had to halt its operations last year is coming back with fresh funding.
SALT Lending, one of the world’s first crypto lending platforms had to cease its deposits and withdrawals last year in November. The platform had to ‘pause’ its operations right after the FTX crash which was the main liquidity provider to the SALT Lending.
Brushing off the dust from last year, SALT has declared that it has been able to close a new round of funding for $64.4 million in exchange for company equity. The investors are positive about the future of the crypto lending platform and believe in its foundational strength. While sharing the news, the founder and CEO of SALT, Shawn Own said,
“Crypto faced a perfect winter storm in 2022, taking significant industry participants like Terraform Labs, Voyager Digital, Celsius Network, Three Arrows Capital, FTX, and BlockFi. SALT was not immune to these market forces, but we are determined to emerge stronger than ever,”
Because of the halted withdrawals, SALT Lending had to lose its operational license in California. However, according to the sources, it is trying its level best to regain the legal permissions to operate in the state of California.
Why Did Crypto Lending Platforms Fail?
It was out of nothing that leading crypto lending platforms just fell out of nowhere. There were different factors that contributed to the fall of many financially strong DeFi platforms. The fall of Terraform labs initiated a series of fallouts in the market, which eventually pushed the market to extreme depths.
In the aftermath of these fallouts, extreme selling pressures were inevitable on lending platforms, most of which had some form of a staking product.
Most of the failed lending platforms also had extremely uneven exposure in particular projects including massive unchecked leverages. A lack of any regulation in the industry was also the reason that nothing related to their operations could be monitored or put to scrutiny before it was too late.
Despite the continued bearish market sentiment, governments and stakeholders are working towards regulating the space. With time, regulations is the only way to safeguard the investor’s security and incite the required trust in the crypto industry.
