The closure causes a violent crash of the associated DMG cryptocurrency.
DeFi Money Market (DMM), one of the first projects in the field of decentralized financial services (DeFi), which wanted to transfer assets from the real world to the blockchain using the „tokenization“ process, unexpectedly closes its doors.
As a reminder: Tokenization means the packaging of an asset in a digital coin (token), which makes it more efficiently tradable.
For example, a property or a work of art can be packaged in many small crypto tokens
“Due to regulatory requirements, DMM has to close”, as the project announces its closure on its own website. To this end, it explains: „DMM is sad that this step had to be taken, which is why we want to thank the Immediate Bitcoin community for their support and active participation.“
The project then explains how the associated mTokens can now be redeemed, because from February 10th they will no longer generate any interest income.
“You certainly have a lot of questions, but unfortunately we cannot answer these questions at the moment,” adds the DMM team.
The closure was confirmed again in several tweets on social media:
In addition to the RealT project, DMM was one of the first crypto projects that wanted to bring assets from „real life“ into the world of DeFi. DMM offered more than 6% interest on the company’s own crypto currency, which is based on „tokenized“ car loans. A modified Chainlink Oracle served as the basis for the project, and the well-known billionaire Tim Draper also invested in the project.
The crypto community speculates that the “regulatory requirements” mean increased pressure from regulators on DMM, which could be due to the fact that the introductory token sale of the project did not go very smoothly . When the company uploaded documents to verify the authenticity of the connected car loans, the borrower’s details were inadvertently disclosed.
The announcement has caused a rapid decline in the value of the company’s own crypto currency DMG. It was recently at a high of $ 0.53 and has now crashed to just $ 0.093.