Goldfinch Protocol to Shut Down as $50M+ User Funds Lost, GFI Crashes 99.8%

According to Cryptopolitan, Goldfinch, an a16z-backed decentralized lending protocol, announced it will enter a gradual shutdown phase last Friday (June 20), following allegations from investor Edward Morra of mismanagement resulting in over $50 million in user fund losses. The announcement came one day after Morra's public disclosure that borrower defaults and failed loan restructurings left depositors unable to recover their funds.

Goldfinch's native token GFI has plummeted 99.8% from its January 2022 peak of $32.94 to below $0.07, with market capitalization declining from over $390 million to under $6 million. The protocol, founded in 2021 by former Coinbase employees, received a $25 million Series A led by a16z in January 2022. Losses mounted following the funding round as key borrowers including Kenya-based Tugende Kenya and Singapore-based Lend East defaulted or failed loan restructuring.