Tulip, a yield aggregation protocol has halted lending deposits on its platform. The protocol announced the development in a Twitter post on Monday. As announced, all lending deposits, new leveraged position creation and whirlpool deposits have been halted until it stabilizes its on-chain liquidity.
Notably, Tulip says users can still withdraw their funds from the lending/whirlpool strategy and manage/close leverage positions. According to the protocol, existing deposits and positions remains unaffected and the strategies will still run. Also, users in leverage position can still add collateral.
Tulip denies exposure to FTX
This comes a few days after Tulip insisted that it possesses zero exposure to FTX/Alameda. Recall that many crypto firms, in the wake of the prevailing FTX crisis, began to reveal their exposure status to the troubled exchange. As of press time, crypto firms like Sequoia Capital, crypto.com and galleries have all confirmed their exposure to the troubled exchange. But the likes of Coinbase, Tether, Circle have, over time, denied exposure to FTX.
FTX saga impacting the sphere
Notably, the crisis befalling FTX has continued to greatly influence the crypto space. It started when a leaked balanced sheet traced to Alameda Research showed that it held billions of dollars of its assets in FTT. As a result, Binance started liquidating its FTT holdings. This in turn triggered the massive fall of the FTT token by 75%. As a result, many firms, including Tulip became worried about their various exposure to the exchange.
Notably, in a late attempt to keep the situation under control, Zhao made moves to acquire the assets of FTX. However, the exchange failed to seal the deal, citing due diligence. Recently, FTX CEO, Bankman-Fried filed for bankruptcy. With this, the protocol joined the likes of Celsuis and Hodlnaut to endure the liquidation turmoil. It is however, not clear, as of press time, if the halting of lending deposits by Tulip is also connected to the saga.
Meanwhile, Tulip protocol runs as the first yield aggregation platform built on Solana with auto-compounding vault strategies. The dApp (decentralized application) manifested to take advantage of Solana’s low cost, high efficiency blockchain, allowing the vault strategies to compound frequently. This allows stakers to benefit from higher APYs without requiring active management. Also, Tulip allows stakers to benefit from higher APYs without requiring active management.
Tulip Protocol, however, promised to update its community when necessary. As of press time, Tulip native token enjoys live price 24-hour trading volume of 82,375.45 USD.