Coinhares suffered a loss of $ 21 million through the VAT-Crash

Coinhares suffered a loss of $ 21 million through the VAT-Crash

Coinshares lost £ 17 million due to the recent crash of Terras Stablecoin, said the company's CEO in an annual report published Tuesday and called it "a humiliating lesson".

Terrausd (VAT), an algorithmic stable coin that was developed for one-to-one trading in the US dollar, began to decoupling in early May. Terra's luna token fell from more than $ 80 at the beginning of this month to a fraction of a center.

Coinshares does not take up any directions and was not exposed to the collapse of the Luna Prize, said CEO Jean-Marie Mogetti in the report. But the company, which is active in the area of ​​decentralized finances (Defi), has a book with engagements in VAT, he added.

The loss from the liquidation of its participations in VAT was £ 17m-this corresponds to about $ 21.4 million.

"While this obviously affects the performance of the group in the second quarter, this loss had no effect on our additional capital market activities and in no way on the protection and settlement of one of the ETPs of the group," wrote Mogetti.

The CEO called the Terra situation "a combat scar that I would never personally forget" and added that the company had implemented additional controls to better predict and alleviate future events.

A spokesman for Coinhares rejected another statement.

The company, which manages around £ 3 billion in its ETP suite, was not the only one that was damaged by Terra's decline.

The crypto research company Delphi Digital said in a blog post dated May 18 that it had not sold a luna during de-pegging. Delphi's 10 million dollar investment in Luna Foundation Guard (LFG) was "completely lost", the blog said and added that the company, which Luna kept in her Delphi Ventures Master Fund, "was on a large, not realized loss".

Matthew Sigel, Head of Digital Asset Research at the asset manager Vaneck, Blockworks said that his Smart Contract Leader find was held during the crash Terra token. The fund was sold when VAT reached $ 0.90, he said.

Overall, Coinhares reported £ 2.4 million in 2021, which was worse than a loss of around £ 1.4 million a year. The adjusted result of the company before interest, taxes and depreciation (EBITDA) for the first quarter of 2022 was £ 18.7 million, a decrease of 45 % compared to the previous year.

Coinshares will try to examine other strategic partnerships and takeovers, "to grow and diversify its sales," adds Tuesday. The company completed its takeover of Napoleon Crypto last year to extend its services to the consumer market.

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The contribution Coinshares Takes $ 21m Loss from UST Crash is not a financial advice.