DeFi Lender Arco Protocol, Launched on Aptos Blockchain, Goes Dark After Botched Fundraise

Network congestions and issues with claiming tokens led to widespread dismay from the Arco community.

By Oliver Knight

Oct 31, 2022 at 10:47 a.m. UTC

Updated Oct 31, 2022 at 4:07 p.m. UTC

CDCROP: Oil and water (Pawel Czerwinski/Unsplash) — Arco Protocol goes offline following Aptos IDO, (Pawel Czerwinski/Unsplash)

Oliver Knight

Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.

Follow @OKnightCrypto on Twitter

Arco Protocol, a cross-chain decentralized finance (DeFi) platform on the newly launched Aptos blockchain, has gone offline following a botched fundraise.

Arco, which offer lending and staking services, intended to raise funds on Oct. 29 in an initial DEX offering (IDO), which is a form of decentralized crowdfunding. DeFi is an umbrella term for lending, trading and other financial activities carried out on a blockchain without traditional middlemen.

However, Arco Protocol said that over 300 people deposited to the IDO at the same time, causing network congestion and an unforeseen issue with token claiming. The Aptos blockchain had a less than stellar start earlier this month.

Arco posted a Twitter poll asking the community whether the funds received should be returned, kept or if the project itself should be handed over to the community.

At press time the majority of respondents have requested a refund. Arco said that Wormhole and Celer Network had cancelled partnerships with them following the calamitous launch.

The Arco Protocol website and Discord channel are both offline.

Arco Protocol did not immediately respond to CoinDesk's request for comment.

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