So it happened in Texas. A likely case similar to that of FTX is what Abra has just been up to.
Am glad the securities team where able to detect on time and hint to the public, because the lies of bear market season would have been used to lock in more unsuspecting customer funds.
For fraud related case is really strong. Binance got its own lawsuit. What could be the reason for this exchanges misbehaving if not due to greed and insatiable quest for vanity.
We all should be wise to ignore such businesses that come with too good to be true offer in order to not become victims.
Topic: Crypto Lender Abra Has Been Insolvent for Months (Read 438 times)
I think the idea itself was wrong to begin with, and the fact that it was a success for a short while doesn't mean that they thought it over for every possible scenario.
The idea is pretty simple, if you stick to the basics you're safe and it works wonders even on this forum in the lending section if you just don't offer loans with collateral! One simply rule, that's all!
This is why it failed, bear market does matter in a sense that during bull market a lot of people made profits so they were all capable of paying it back, but when the bear hit, nobody was capable of paying it and that's why they had a lot less customers and a lot less people paying.
Two mistakes with this:
- in a bear market it's actually easier to pay back your loan if you took a crypto loan. If you took 1BTC at a price of 60k you had to pay back $5k a month plus interest for a one-year loan, right now you only have to pay 2k, so it's way easier.
- that's why collateral is in for, if you don't pay the lender gets the collateral, if the collateral goes under 110-120% of the value loaned it gets liquidated and your loan is terminated, you lose your coins but the lender isn't losing a penny
If the lender follows basic self-imposed rules and common sense he can't get rekt.
That's why in crisis in the real world loan sharks thrive, they don't get bankrupt!
No company can stay afloat that way and it is impossible to keep it going.
Then why are others still operating?
This wasn't supposed to be an investment form where you daily trade or open long positions it was most important of all a service that would take a percentage of the sum involved. It didn't matter if BTC was at 1000 or 10 000, if somebody was trying to send $500 of remittance they would still be taxed, it's not like suddenly they would make 10 times less.
If it were like this all casinos would be bankrupt also, but they don't seem to care about a bear or a bull market too much.
Abra tried to maximize its earnings, they tried to give very cheap loans with high collateral rates, you could get the cheapest on the market with a 1:5 ratio, then they would not only get money from the interest but also they played with your collateral by investing it in now-defunct platforms.So when the time was for liquidation to cover the not paid loan they had nothing to liquidate.
I think the idea itself was wrong to begin with, and the fact that it was a success for a short while doesn't mean that they thought it over for every possible scenario. This is why it failed, bear market does matter in a sense that during bull market a lot of people made profits so they were all capable of paying it back, but when the bear hit, nobody was capable of paying it and that's why they had a lot less customers and a lot less people paying.If it were like this all casinos would be bankrupt also, but they don't seem to care about a bear or a bull market too much.
Abra tried to maximize its earnings, they tried to give very cheap loans with high collateral rates, you could get the cheapest on the market with a 1:5 ratio, then they would not only get money from the interest but also they played with your collateral by investing it in now-defunct platforms.So when the time was for liquidation to cover the not paid loan they had nothing to liquidate.
No company can stay afloat that way and it is impossible to keep it going. I believe that we should be considering the situation as a way to get out of this easily, if it doesn't work in any other way then just do not put your money into places like this. The return doesn't worth the risk you are taking with trusting them.
Given the bear market, Abra's circumstances aren't shocking.
You cannot blame a bear market for this (never mind that bitcoin is over 60% higher than it was 6 months ago).Centralized exchanges, lending platforms, and what not, should be holding customers' deposits in cold storage. If they actually did this 100% of the time, then it doesn't matter if bitcoin is worth $1 or $1 million, because 1 BTC = 1 BTC and the platform will always have the exact amount needed to cover all their customers' deposits. It is when these platforms start wildly gambling customers' money that they run in to problems and end up insolvent.
Exactly!
This wasn't supposed to be an investment form where you daily trade or open long positions it was most important of all a service that would take a percentage of the sum involved. It didn't matter if BTC was at 1000 or 10 000, if somebody was trying to send $500 of remittance they would still be taxed, it's not like suddenly they would make 10 times less.
If it were like this all casinos would be bankrupt also, but they don't seem to care about a bear or a bull market too much.
Abra tried to maximize its earnings, they tried to give very cheap loans with high collateral rates, you could get the cheapest on the market with a 1:5 ratio, then they would not only get money from the interest but also they played with your collateral by investing it in now-defunct platforms.So when the time was for liquidation to cover the not paid loan they had nothing to liquidate.
Given the bear market, Abra's circumstances aren't shocking.
You cannot blame a bear market for this (never mind that bitcoin is over 60% higher than it was 6 months ago).Centralized exchanges, lending platforms, and what not, should be holding customers' deposits in cold storage. If they actually did this 100% of the time, then it doesn't matter if bitcoin is worth $1 or $1 million, because 1 BTC = 1 BTC and the platform will always have the exact amount needed to cover all their customers' deposits. It is when these platforms start wildly gambling customers' money that they run in to problems and end up insolvent.
I have heard this name for the first time in my life despite being in this community (active). So maybe not a big deal but it is because it's crypto, isn't it?
Everything in Crypto is BIG. So a lender called Abra getting insolvent in a bear market, where the biggest of the biggest fall is a big news.
Nah it was a pretty big cryptocurrency exchange/wallet service back in the day, I’ve even seen money remittance centers in my country offering swap to cryptocurrency through the Abra platform, so they hold a lot of relevance. This insolvency however has been predicted way back in the past though, since every other platform remained standing strong whilst Abra barely scrapes by as more and more people switch over to much more popular platforms. Still sucks cause it’s pretty much a good part of the crypto history but at the same time I blame the creators of this platform for their lack of anything to offer besides exchanging and safekeeping, with the latter even becoming out of the question cause this is a centralized exchange we’re talking about and they particularly suck at making sure their user’s coins are safe. Everything in Crypto is BIG. So a lender called Abra getting insolvent in a bear market, where the biggest of the biggest fall is a big news.
Lets not lose focus on the wider panorama. Bitcoin and crypto have reshaped financial interactions, promising enormous potential. This occurrence, though important, is a small setback on a larger journey.
I have heard this name for the first time in my life despite being in this community (active). So maybe not a big deal but it is because it's crypto, isn't it?
It was one of the largest remittance gateway then crypto lenders of the old generation that didn't go bust in the previous waves of bankrupcies, most users have seen it like the killer app that as needed in 2014-2015, then it really expanded into exchange, shitcoins interest and so on, probably their peak moment of glory in 2017 having enough money to bribe celebrities into advisory roles
https://www.forbes.com/sites/laurashin/2017/08/02/bitcoin-startup-abra-adds-gwyneth-paltrow-as-advisor-is-featured-in-apple-reality-tv-show/
It's way older than most members here
but at the same time I blame the creators of this platform for their lack of anything to offer besides exchanging and safekeeping, with the latter even becoming out of the question cause this is a centralized exchange we’re talking about and they particularly suck at making sure their user’s coins are safe.
Actually, if they would have just stuck to that business model they would have been fine, you don't need to expand in every direction if you have a solid business base, see how WU is thriving for decades and not going into anything else, lending money to a shitty business with shitcoins collateral is a recipe for disaster. And no sane person would deposit 10 BTC worth $300k to be able to take a $150k loan.
I have heard this name for the first time in my life despite being in this community (active). So maybe not a big deal but it is because it's crypto, isn't it?
Everything in Crypto is BIG. So a lender called Abra getting insolvent in a bear market, where the biggest of the biggest fall is a big news.
Nah it was a pretty big cryptocurrency exchange/wallet service back in the day, I’ve even seen money remittance centers in my country offering swap to cryptocurrency through the Abra platform, so they hold a lot of relevance. This insolvency however has been predicted way back in the past though, since every other platform remained standing strong whilst Abra barely scrapes by as more and more people switch over to much more popular platforms. Still sucks cause it’s pretty much a good part of the crypto history but at the same time I blame the creators of this platform for their lack of anything to offer besides exchanging and safekeeping, with the latter even becoming out of the question cause this is a centralized exchange we’re talking about and they particularly suck at making sure their user’s coins are safe. Everything in Crypto is BIG. So a lender called Abra getting insolvent in a bear market, where the biggest of the biggest fall is a big news.
Again, probably a little too late to remind for a thousand times the thing about not your keys not your coins and to stop chasing huge returns trying to get rich doing nothing. The only thing I'm actually curious about is if we will have any of those "earning and earning" platforms alive by the end of the year!
Telling people won't change much, because a lot of "investors" won't read this forum or other sources of information that expose these scams. They go from knowing nothing about crypto other than it exists + can go high to clicking on a YouTube video shilling for some crypto opportunity to putting their hard earned money into a scam. Maybe some are doing "research" by googling the service they are about to use, and finding all the positive feedbacks on the first results page due to the SEO.
This is why the regulation is necessary, without it "crypto" will be synonymous to "scam" and it will be negatively reflecting on Bitcoin too. Not to mention the damage to economy and to society from these scams.
Wait is insolvency the same thing as bankruptcy in the crypto world?
Pretty sure there are people who knows the risk of keeping their crypto with these guys but then still go ahead to do it. They have their reasons and I do not blame them for it. It could be a way to make money or side hustle from these guys. They were prepared for this and willing bear the consequences.
As long as it is not my keys nor my coins, I wish those who still go ahead and leave their coins with these guys all the very best.
Pretty sure there are people who knows the risk of keeping their crypto with these guys but then still go ahead to do it. They have their reasons and I do not blame them for it. It could be a way to make money or side hustle from these guys. They were prepared for this and willing bear the consequences.
As long as it is not my keys nor my coins, I wish those who still go ahead and leave their coins with these guys all the very best.
Change the word "Abra" to "Celsius" and that entire story could have been copy and pasted from a year ago.
It always starts during parabolic runs up, people get into the next
Like you & many others have said repeatedly, not your keys not your coins. There’s only so many times people can be advised. You just can’t help stupid.
We’ll be back discussing the same again but different in 2026 after the 2024/25 run up:
snip~
Again, probably a little too late to remind for a thousand times the thing about not your keys not your coins and to stop chasing huge returns trying to get rich doing nothing. The only thing I'm actually curious about is if we will have any of those "earning and earning" platforms alive by the end of the year!
The same things can happen again and again because people will never learn anything until they took their greed out when it comes to investments. 10% isn't that much return, to be honest, and not really worth the risk which is 100%.Again, probably a little too late to remind for a thousand times the thing about not your keys not your coins and to stop chasing huge returns trying to get rich doing nothing. The only thing I'm actually curious about is if we will have any of those "earning and earning" platforms alive by the end of the year!
Simply holding the BTC in their wallet will give away huge returns if they go through the bull season so all they need to do is to buy and wait for the bull trend and then sell to make profits.
Abra wallet you mean?I've never like such a wallet and if you are familiar with open-source wallets you should know that Abra is not one of them,
Not Abra wallet, it is their lending service that has gone bust. But i would not use any of their services, whether it is their crypto wallet, lending or staking services.the closest to an open-source wallet that I can use is Trust wallet, I know it's not open source but it's better than other closed source wallets, should have been a better option over this Abra wallet too.
Trust wallet isn't at all close to an open source wallet, it is closed source and owned by Binance, i don't know why you think it is better than other closed source wallets, because it is not. Both Abra wallet, their lending services and Trust wallet are all not recommended, do not give away the custody of your coins for APY that are not realistic and use an open source and self custody wallet like Electrum for your BTC's, as for your shitcoins, unstoppable wallet is also recommended. 
The problem with people who keep their asset for more profit is greed. They are too greedy that they allow it to take over their senses. If not you know that a crypto lender platform can do away with your funds whenever they like and come up with the name of running out of liquidation.
It is always said that a centralized platform can't be trusted,because of their dubious act. They deceive you to safe your crypto in their platform and entice you with big interest, unknown to users that it is a way to scam them of their asset. Such companies are attracting the government to regulate crypto because of these actions.
It is always said that a centralized platform can't be trusted,because of their dubious act. They deceive you to safe your crypto in their platform and entice you with big interest, unknown to users that it is a way to scam them of their asset. Such companies are attracting the government to regulate crypto because of these actions.
Abra wallet you mean?I've never like such a wallet and if you are familiar with open-source wallets you should know that Abra is not one of them, the closest to an open-source wallet that I can use is Trust wallet, I know it's not open source but it's better than other closed source wallets, should have been a better option over this Abra wallet too.
I also do not like crypto wallets that gives returns on your assets when you hold using their wallet it makes no sense because it just doesn't, they are doing this to attract users I get but you will never see an open source wallet giving up money to users using their crypto wallet.
I also do not like crypto wallets that gives returns on your assets when you hold using their wallet it makes no sense because it just doesn't, they are doing this to attract users I get but you will never see an open source wallet giving up money to users using their crypto wallet.
I've been contemplating about them for months or I think it's already a year, I've registered there but never pursue what I am about to deposit there. I guess my gut has saved me and then the issues of lending platforms came out.
They've got an interesting promise for their customers but then again, when a platform offers the same thing then we all got a signal of what we should avoid.
They've got an interesting promise for their customers but then again, when a platform offers the same thing then we all got a signal of what we should avoid.
This is de-fi if I'm not mistaken
"DeFi" is a meaningless buzz word. The majority (or indeed all?) of projects which style themselves as DeFi are not decentralized in the slightest. How can it be decentralized with a centralized third party can disappear with all your coins at any moment? Same as the term "DEX". I can count the number of exchanges which could genuinely be referred to as DEX on one hand, but there are hundreds of scam platforms out there advertising themselves as DEXs and enticing people to deposit their coins to buy the latest shiny shitcoin or stake for some obviously unsustainable return.Out of interest, here is a post I made about DeFi three years ago:
I haven't spent a huge amount of time looking in to DeFi (so perhaps I shouldn't really comment at all), but from what I have seen, it seems to me to be exactly as you claim - unbelievable rewards and gains. Until someone can prove to me otherwise, as far as I am concerned it is essentially going to be the same as the ICO craze. A minority of lucky people will make very good returns, a lot of people will lose everything or almost everything they put in, and in a year or two 99% of the projects/coins/tokens will be dead and forgotten.
Seems like I was proven right. NFTs are already well on their way to the same fate, and the craze of bitcoin ordinals seemed to be over within a few weeks.
I'm sure it will only be a few months before the next craze of shiny trash comes along to help people rapidly lose their money. I've already seen the term "Centralized DeFi" or "CeDeFi" make the rounds, which is just outright hilarious.
Change the word "Abra" to "Celsius" and that entire story could have been copy and pasted from a year ago. I am 100% certain we could post the same story this time next year with a dozen other platform's names substituted in instead.
Yep. This is de-fi if I'm not mistaken (and please pardon my ignorance, but I never got past all of those extremely attractive advertised yields), and I've always figured that the market for crypto lending is based on pure speculation, i.e., people aren't borrowing it to finance houses or cars or whatever but to trade with. And if that's the case, it doesn't seem like a sustainable business model to me--or a sustainable investment vehicle for the lenders.But take a look at how many members we have on this forum who are desperate for money; desperate enough that they'll either scam for pennies or join some of the scammiest bounties in the hopes that they'll be rewarded with worthless tokens. If you take that into account, it really isn't surprising that when a newly-formed company offers returns so much higher than the stock market (or any other market for that matter), they pounce on it. It's understandable but unfortunate.
And while everybody is chasing these outrageous returns and the companies eventually go bust, what happens? The regulators start taking notice and crypto comes under high scrutiny. It's ultimately not good for any of us in the long term.
I would like to point out that even thought it makes sense that the most of the lending volume of those platforms can be purely speculate, I still have hopes that in the future more people would move from centralized debt towards decentralized debt or at least crypto related loans.
It is something I have made before, I asked a relatively small loan (using Bitcoin as collateral) and I did not use it to gamble on shit-tokens but rather I bought a tablet I wanted to buy for a while. Paid back my debt and interest and end of the story. That is what it should be if we wished for the cryptographic ecosystem to start getting some of the market pie off the hands of banks.
Change the word "Abra" to "Celsius" and that entire story could have been copy and pasted from a year ago. I am 100% certain we could post the same story this time next year with a dozen other platform's names substituted in instead.
Yep. This is de-fi if I'm not mistaken (and please pardon my ignorance, but I never got past all of those extremely attractive advertised yields), and I've always figured that the market for crypto lending is based on pure speculation, i.e., people aren't borrowing it to finance houses or cars or whatever but to trade with. And if that's the case, it doesn't seem like a sustainable business model to me--or a sustainable investment vehicle for the lenders.But take a look at how many members we have on this forum who are desperate for money; desperate enough that they'll either scam for pennies or join some of the scammiest bounties in the hopes that they'll be rewarded with worthless tokens. If you take that into account, it really isn't surprising that when a newly-formed company offers returns so much higher than the stock market (or any other market for that matter), they pounce on it. It's understandable but unfortunate.
And while everybody is chasing these outrageous returns and the companies eventually go bust, what happens? The regulators start taking notice and crypto comes under high scrutiny. It's ultimately not good for any of us in the long term.
Change the word "Abra" to "Celsius" and that entire story could have been copy and pasted from a year ago. I am 100% certain we could post the same story this time next year with a dozen other platform's names substituted in instead.
It seems there is no shortage of people in this world who flat out refuse to learn any lessons from the past or pay any attention whatsoever to what is going on around them.
I have ran out of sympathy for people who still have their funds on these centralizedscams exchanges and earning platforms. Absolute insanity by this point.
As you have already said in earlier post they simply ignore all the stuff and how these centralised platforms are making money out of users pockets and later on declare themselves insolvent.They have in mind like it's not the case with them for instance the Binance and Coinbase users have in mind they are very safe and it would not happen to them but they miss have FTX users thought about it? It was the exchange supporting major centralised and lending platforms in the market but what happened after? The people lost money not these platforms so we will see people getting panicked after anything happens to them but Don't care for privacy or safety of funds so wny should we have sympathy for them. It seems there is no shortage of people in this world who flat out refuse to learn any lessons from the past or pay any attention whatsoever to what is going on around them.
I have ran out of sympathy for people who still have their funds on these centralized
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