Kinto Shuts Doors: $1M Debt and July Attack Fallout
After failing to bounce back from a string of setbacks, including a $1 million debt load and the fallout from a July attack, Kinto (K) declared it was closing. The K token fell about 85% in the last day as a result of the revelation, which set off a violent sell-off. In a statement posted on X, the DeFi project announced the decision and acknowledged that it had tried every option to move forward.
Kinto Sets September 30 Deadline for Asset Withdrawals Amid Shutdown
Users have until September 30 to withdraw their assets, the project stressed. In the meantime, almost 76% of the principal will be recovered by Phoenix lenders. Furthermore, a goodwill fund established by the founder allows Morpho victims—who were most severely impacted by the July exploit—to receive up to $1,100 each.
It’s time to accept reality. I pursued this venture to the best of my ability, but didn’t achieve a successful outcome. The CPIMP exploit was a black swan, yet I am contributing over $130,000 to offer relief to affected users,
Kinto founder Ramon Recuero
The project emphasized that although the July CPIMP proxy exploit used 577 ETH, its wallets, Layer-2 infrastructure, and core systems were never compromised. This reportedly forced Kinto to increase debt in an effort to get better. On July 10, the K price fell more than 90% as a result of the incident. Its hopes of obtaining more fundraising were finally destroyed by the extra liabilities and the state of the market.
Kinto Collapse Raises Concerns Over Trust in Early-Stage DeFi Projects
Some users have reacted negatively to the abrupt closure, criticizing Ethereum L2 for shutting down after gaining money. Kinto, however, disputes the notion that the closure was a rug pull and maintains that neither the team nor investors had unlocked a single token. Kinto advised consumers to submit requests for help to customer support because other users have asked for permission to remove their assets. However, the collapse serves as a clear warning of the vulnerability of early-stage DeFi ventures, even though Kinto maintains that it is closing down responsibly.
Create a help ticket in Discord if you need help withdrawing,
Kinto
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