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Yotta Bank Controversy

<8 185 Crypto-adjacent "bank" Yotta fails, user funds frozen (self.Buttcoin) submitted 20 hours ago by 2018_BCS_ORANGE_BOWL Yotta is a fintech firm with the following gimmick: instead of paying out a consistent interest rate to all their users, they use a sweepstake system to pay large amounts to a few users. The more money you have in the bank, the more tickets for their lottery you get. I first heard of them when their CEO did an AMA and stated that their user deposits were FDIC ensured, but that they could "decline" FDIC insurance for higher interest rates. It turns out by "decline FDIC insurance" they meant "use your money to stake stablecoins instead of keeping it in an FDIC account". The only stablecoin mentioned on their website in 2021 [1] was UST (Terra). Your money is stored in stablecoins like UST, which are cryptocurrencies pegged 1:1 with the US Dollar. We partner with trusted organizations like Terraform Labs (backed by Coinbase, currently managing over $300 million) to offer a much higher yield than a traditional bank. When Terra/Luna collapsed they quickly said "Haha we are actually all in USDC we never got around to using Terra". I'm wondering if they actually took a bath on Terra now. Anyways now they've frozen withdrawals for the last month, blaming their intermediary bank which recently declared bankruptcy. Users are starting to question if they were ever FDIC insured, coffeezilla video[2], the usual. It's like all the fun of crypto but with boring old fiat!
<8 185 Crypto-adjacent "bank" Yotta fails, user funds frozen (self.Buttcoin) submitted 20 hours ago by 2018_BCS_ORANGE_BOWL Yotta is a fintech firm with the following gimmick: instead of paying out a consistent interest rate to all their users, they use a sweepstake system to pay large amounts to a few users. The more money you have in the bank, the more tickets for their lottery you get. I first heard of them when their CEO did an AMA and stated that their user deposits were FDIC ensured, but that they could "decline" FDIC insurance for higher interest rates. It turns out by "decline FDIC insurance" they meant "use your money to stake stablecoins instead of keeping it in an FDIC account". The only stablecoin mentioned on their website in 2021 [1] was UST (Terra). Your money is stored in stablecoins like UST, which are cryptocurrencies pegged 1:1 with the US Dollar. We partner with trusted organizations like Terraform Labs (backed by Coinbase, currently managing over $300 million) to offer a much higher yield than a traditional bank. When Terra/Luna collapsed they quickly said "Haha we are actually all in USDC we never got around to using Terra". I'm wondering if they actually took a bath on Terra now. Anyways now they've frozen withdrawals for the last month, blaming their intermediary bank which recently declared bankruptcy. Users are starting to question if they were ever FDIC insured, coffeezilla video[2], the usual. It's like all the fun of crypto but with boring old fiat!

Yotta Bank Controversy
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