- The protocol will soon move to recording-only mode.
- The TVL on Algofi experienced a fall of more than 12% after the announcement.
from Algorand [ALGO] The largest decentralized finance (DeFi) protocol, Algofi, is going to cease operations. The blockchain platform made the announcement on his blog recently.
Algofi is going to end its activities due to a “confluence of events” as it cannot meet the highest standards of the protocol. It will soon go into recording-only mode.
Algofi is a lending protocol based on the layer-1 Algorand blockchain that allows users to earn interest, borrow and trade their ALGO tokens.
The blog post reads,
“The team believes that going forward we will no longer be able to provide the support necessary to maintain the protocol to the high standards we believe the community deserves. We will start by deprecating the platform and putting the platform in recording-only mode.
Algofi will also disable all social media accounts except the Discord channel to maintain required communications. It will take months to shut down the entire operation at Algofi. Meanwhile, the team will work to minimize crypto market collateral factors on its platform, allowing liquidity to shift to other protocols.
However, the team underlined its belief in Algorand’s blockchain technology and its new consensus algorithm.
Source: Defillama
Shortly thereafter, the total value of assets locked (TVL) on the Algorand network fell by more than 5% and stood at approximately $58.94 million at the time of writing.
Source: Defillama
Similarly, the TVL on Algofi experienced a drop of more than 12%.
How ALGO trades
Remember, it was back in April that the US Securities and Exchange Commission (SEC) labeled ALGO and five other tokens as securities when it charged crypto asset trading platform Bittrex for operating an unregistered national stock exchange.
While the Algorand Foundation challenged the SEC’s classification, market opinion of the token certainly suffered.
Since the regulator’s enforcement action against Bittrex, ALGO’s value has fallen by more than 50%. However, the token defied the latest news at Algofi quite well as the token barely lost its value.
At the time of writing, ALGO changed hands for $0.1114.
Source: ALGO/USD, TradingView