Free Withdrawals from CeFi Became History as Gas Prices Hiked
Ethereum prices have sustained at a high level recently and so are transactions fees incurred on the Ethereum network. On February 26, it averaged 15 USD per transactions. However, on February 23, it averaged almost 40 USD per transactions.
The spike in Ethereum gas prices on February 23 has caused a number of CeFi platforms to renege on their free withdrawal policy over the ERC-20 network.
It started off with NEXO app being taken down for a couple of hours during the spike in gas fees. None of us were able to log into the app during that time. Later on, we received an email from NEXO abolishing their free withdrawal policy for base and silver members, with immediate effect. When we were able to log into the NEXO app again, we were no longer able to make any free withdrawals. The fee structure, however, was not clear.
The wordings mentioned that the abolishment of free withdrawal policy is temporary. We hope that this is indeed the case. One thing that has really disappointed and annoyed users in this incident is that NEXO made the immediate change without any advance notice, in contrary to common business practices. We expect that NEXO will suffer in its standing among CeFi platforms from the way that this incident is handled.
On the same day, FTX exchange also announced a change to its free withdrawal policy over the ERC-20 network. However, it is giving users at least one or two days of advance notice before implementing the change.
Eventually, the change implemented by FTX exchange was effective actually one more day later after the scheduled date.
One day later, we received another email from BlockFi announcing an amendment to its free withdrawal policy. The nice thing is that BlockFi is still retaining the one-time free withdrawals each calendar month. The adjustment only applies to second withdrawals onwards in each month. While the withdrawal fee over ERC-20 is increased to cover the cost, the withdrawal fee over Bitcoin network is actually decreased.
This clearly shows that BlockFi cares more about its customers than NEXO.
At this moment, we haven’t heard about any change in withdrawal fee policy from Celsius Network and ApyHarvest. For Celsius Network, one is able to get unlimited free withdrawals. For ApyHarvest (referral code:WX7G10K14C) , withdrawals are free if the amount is more than 300 USDC.
We currently favor Celsius Network, BlockFi and ApyHarvest over NEXO for interest earning crypto platforms.
