While the crypto sector has experienced significant positive developments recently, it should not be overlooked that unfortunate incidents have also occurred. Actions focused on Multichain have exemplified this perfectly, with a domino effect that continues. Leading lending protocol, Geist Finance, has officially announced its closure.
The team behind Geist Finance, showcasing the massive losses incurred during the Multichain events, bid farewell to the industry through a social media post. The protocol was actually one of the key components of the Fantom Network and temporarily suspended all contracts on July 6. Geist Finance then made a limited comeback, only accepting withdrawal requests and repayments.
Now, the recent announcement confirms that it is completely over. It appears that Geist Finance will not be able to reopen for lending and borrowing operations. Prior to the Multichain events, Geist Finance had $29 million worth of locked cryptocurrencies. Despite the contract review being favorable for Geist Finance, an unexpected situation brought an end to the protocol.
The lending protocol allowed many users to obtain or provide crypto loans, even across different networks. Integrated with the Multichain platform, Geist Finance supported USDC, USDT, BTC, and ETH. The Geist Finance team, utilizing Chainlink oracle service, tracked and determined the prices of these assets, enabling lending and borrowing based on the aforementioned cryptocurrencies.
A social media post reveals the situation in all its nakedness.
The Geist team stated that they took this step after learning that the assets on Multichain would not be repaid. They also emphasized that Chainlink oracles did not track the value of these assets, clarifying that it was not an accusation.
The Multichain incident has yet to be resolved, and this critical process is ongoing. In the meantime, many DeFi protocols are either declaring bankruptcy or seeking alternative solutions due to the impact of the situation. Geist Finance, unfortunately, is one of those protocols that were not so lucky, highlighting how fragile the DeFi sector can be by deciding to shut down entirely.