Everlend Finance, the company behind the Solana decentralised finance (DeFi) system, is winding down its business activities and requesting that users remove their cash from the network.
On February 1, the firm announced the decision through Twitter, explaining that while having “enough runway” to continue functioning, doing so would be a risk given the present state of the industry. In particular, Everland’s team made the following observations: “Unfortunately, there is not enough liquidity in the rn market, and this problem is not unique to Solana. Furthermore, the B/L market, which Everlend is completely reliant on, continues to contract. Under these circumstances, continuing would be gambling to do so. And despite the fact that there was plenty of runway left, we made the decision to halt here.”
Everlend also said that deposits from underlying protocols are now stored in vaults, and that the app would be limited to withdrawals only until the funds are completely cleared. “We urge that our customers remove their cash as soon as possible,” the company said.
The group has said that all monies, collected and utilised, together with payments made to third-party contractors, will be “covered” over the next two weeks. This indicates that all parties involved will be compensated in full for their contributions. The codebase of the protocol will also be made publicly available, enabling others to continue developing solutions based on it.
Everlend was established in 2021, and its strategic plan for the following months involved the introduction of both a governance platform and a money market. Everstake Capital, GSR, and Serum were among the investors in the protocol.
During the height of its popularity, DeFi Llama reports that Everlend had nearly $400,000 worth of total value locked (TVL). However, as a result of the collapse of FTX, the protocol had a considerable fall, which had an adverse effect on the liquidity of the market.
Everlend is the second Solana-based DeFi technology to go down within a few days due to crypto winter. Everlend was the second protocol to shut down. Friktion platform made the announcement that it will be shutting down its user interface on January 27. The company cited a “difficult market for DeFi expansion” as the reason for its decision.
The decision was made after Everlend reported over a year earlier that it had successfully completed a financing round in which it had received $5.5 million. Shortly before the FTX crash hit in November, the business even began offering undercollateralized loans with the intention of satisfying the demand for DeFi shown by institutional investors.