Crypto yield platform Freeway halted all withdrawals on its platform that holds over $100 million user assets citing “unprecedented volatility.”
According to a screenshot shared by pseudonymous researcher FatManTerra, Freeway co-founder Graham Doggart said the platform would be halting all withdrawals in a Discord announcement at around 12:00 pm ET on Sunday.
Freeway has reportedly deleted the names of all the team members on its website that now displays the same message posted to its Discord server earlier in the day.
“As all of you will be aware, there has been unprecedented volatility in Foreign Exchange and Cryptocurrency markets in recent times,” read the Freeway update.
The company claimed it would be diversifying its asset base to manage this volatility in the name of ensuring the “long term sustainability and profitability” of its ecosystem.
For context, Freeway is a crypto platform that promises an annual yield of 43% if users buy and stake its “Supercharger” simulations.
FatManTerra, known for his research in disclosing on-chain scams, first alerted users that Freeway was potentially operating a Ponzi scheme in a tweet on Saturday.
“In my opinion, it’s likely that Freeway will collapse within the next few months and that all depositors will lose everything,” said FatManTerra, after he noticed a few large withdrawals being delayed on the platform.
After digging deeper into the platform’s claims, FatManTerra observed several inconsistencies, including false disclosures on the website an unclear monetization strategy.
Freeway is said to be in custody of more than $100 million worth user funds. At the time of writing, Freeway’s native token FWT was trading at $0.001754, down 71% over the last 24 hours.