Poolin Issues IOU-Tokens During Suspended Withdrawals

Poolin, the largest Bitcoin mining pool by hashrate, paused all withdrawals, flash trades, and internal transfers within their internal wallet service, PoolinWallet, on September 5, 2022. Users were still able to change their payout wallet addresses from their Pool Account to an external wallet address to continue receiving miner earnings. 

On September 13, Poolin announced on a Medium blog post that they would be issuing IOU (I owe you) tokens. The IOU tokens will be available and issued by PoolinWallet representing users’ original holdings of BTC, ETH, USDT, LTC, ZEC, and Doge. A snapshot was taken and the IOU-tokens should have been allocated earlier today. The IOU-tokens will replace their corresponding tokens and their original holdings of tokens will be reset to 0.

Users can withdraw IOU-tokens at any time and requests for withdrawals will be approved quickly and automatically. The post states that “in practice, PoolinWallet will offer IOU-token to token single-direction swap.” This would allow users to trade their IOU-tokens to their original token at a 1:1 ratio. 

Poolin paused withdrawals in an attempt to preserve assets and stabilize their liquidity issues. Since they will immediately start allowing withdrawals of the IOU-tokens, it would seem that their liquidity issues are mainly limited to their crypto holdings. The company is likely confident in solving their liquidity issues soon, if they’re going to offer the option to swap back into the original crypto. 

The tokens will be built on the ERC-20 token standard issued on the Ethereum blockchain. This means that the token can be traded on chain. Poolin will also be accepting payments for new mining rigs in the new token. Poolin US company shares will soon be purchasable with IOU-token payments. The company also stated that even more applications for the token would be announced soon.