Neutrl Finance paused smart contracts after a position created a liquidity shortfall in reserves; protocol holds $27M in liquid assets and plans redemption process by early September.
DeFi & Yields ·
Neutrl Finance paused its smart contracts after identifying a position that created a liquidity shortfall within part of its reserves. The protocol clarified the pause resulted neither from a smart contract exploit, hack, nor code vulnerability. Neutrl currently holds approximately $27M in available liquid assets while maintaining additional positions and associated profit-and-loss figures that remain illiquid.
The protocol plans to open an early redemption mechanism for NUSD and sNUSD token holders, structured to treat all holders equitably. Neutrl is targeting an early September launch, contingent on successful deployment of a new redemption contract, completion of an independent audit, and further legal and financial review. The team acknowledged that unwinding and recovering the remaining portfolio will be time-consuming and cannot yet confirm the amount or timing of any recovery.
Neutrl advised against trading NUSD or sNUSD tokens during the assessment period, citing potential effects on user recovery. The protocol is working with legal counsel and stated that the redemption timeline may change pending further review. Full terms and details for the redemption process have not yet been disclosed.