$100 million rug pull on Freeway leaves DeFi users torn

• Freeway, a crypto staking platform halted all withdrawals and wiped out names of team members from their website. 
• Fatman Terra, an analyst who uncovered the Terra LUNA scam shared details of the $100 million rug pull on the staking platform. 
• The analyst had instructed users to withdraw their funds from the platform and suggested that Freeway is a ponzi scheme. 

Terra Luna exploit expert Fatman Terra has accused crypto staking platform Freeway of a rug pull. A rug pull is the event in which the management pulls user capital and abandons the project, essentially pulling the rug under traders. The platform has halted withdrawals and deleted team member details from their website. This has sparked rumors of a rug pull and confirmation is awaited. 

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Crypto staking platform accused of $100 million rug pull

Crypto staking platform Freeway offered users up to 43% annual rewards previously. Now the project is making headlines for what looks like a rug pull to the analyst behind the Terra Luna expose. Fatman Terra, a crypto Twitter influencer and the brains behind the investigative journalism into the implosion of sister tokens LUNC (previously known as LUNA) and UST (Terra’s algorithmic stablecoin). 

The Terra-UST implosion wiped out $41 billion from crypto market capitalization and Fatman Terra dropped key details on the reason behind the event on Twitter. On October 23, Freeway halted withdrawals and deposits citing market volatility. This aroused Fatman Terra’s suspicion. On October 22, Fatman completed his evaluation of the platform and advised users against using the staking platform. The expert recommended that users withdraw their funds as soon as possible as the platform is likely to implode within months. 

The firm notified users that it has decided to diversity its asset base and avoid future market volatility to increase the platform’s sustainability. Therefore there is no confirmation of a $100 million rug pull yet. 

Fatman argues that halted withdrawals are a key indicator of the platform’s health. The deletion of team member’s info is another factor rousing suspicion in the crypto community. In his recent tweet, the expert lists a series of factors that contribute to the possibility of a rug pull on the staking platform. 

To avoid falling prey to such events, traders need to evaluate staking platforms and DeFi apps with unrealistic rewards. 43% annual rewards ended up being unsustainable for Freeway, pushing the platform to a point where market volatility has affected liquidity and withdrawals are frozen.