By Alys Key
4 min read
Crypto yield scheme Freeway has paused withdrawals on its platform, prompting its token (FWT) to plunge by more than 70% in value.
The company, formerly known as AuBit, allows users to buy “Superchargers,” which simulate a range of cryptocurrencies. According to Freeway, holders then begin receiving daily rewards, with total possible annual rewards of up to 43%.
In a statement posted to its website and on Twitter on Sunday, Freeway said it had decided to diversify its assets to ensure the long-term sustainability and profitability of the system. The move was framed as a response to volatility in foreign exchange and cryptocurrency markets.
“This will allow Freeway to maintain the highest level of Supercharger simulation rewards,” the statement said.
While the process is ongoing, Freeway said it would be allocating capital to its underlying portfolio, meaning it would not be buying back any Superchargers, leaving users unable to cash out.
No date was given for the end of the process and Freeway said it would not comment further beyond the initial statement.
The 43% return touted by Freeway is based on a 20% basic annual return rate. Holders could then boost the annual reward by taking part in various loyalty incentives, according to a video made by Freeway. The first involves getting users to set a 30-day notice period on any sale of their Superchargers, which would earn them an extra 10% return. They can then add another 10% by holding a certain number of Freeway Tokens.
The final 3% comes from the platform's "activity score,” which initially involved signing up for the company’s newsletter.
Freeway promised on its website that more ways to boost this score were coming soon and could be worth as much as 10%, meaning the total potential return promised to customers would reach a huge 50%.
Freeway initially launched as AuBit in 2017, later rebranding to Freeway on January 3 of this year.
It was founded by Graham Doggart and Sadie Hutton, who now act as co-chief executives, along with Peter Neilson, who is listed as a director.
Doggart and Hutton were previously married and have a child together, but are now divorced, according to a Medium post published by Doggart in July of this year.
“We are better as business partners, co-parents, and friends, so that is why it is that way,” he wrote. “Freeway has grown 100x with us at the helm, and [we are] no longer in a relationship the past couple of years.”
Hutton and Doggart’s previous businesses together include a fish and seafood wholesaler named Glacial Brite, and a company called GSCD Limited which declared bankruptcy in 2017.
Both were also involved with Dynamic Abundance, a blockchain and fintech advisory company that is no longer active.
The three founders are currently the only team members listed on Freeway’s website, but an archived version of the site shows five more people.
One of these, chief operating officer Mark Kearns, is also listed as a director of Aubit’s UK company profile.
Aubit Holdings UK filed its 2021 accounts at the end of last month, reporting a total loss of £1,366 ($1,545) for the period.
There is also an Estonian listing for the company under the name Freeway Exchange, where documents show just a €63 ($61) profit for 2021 and records current assets as €12,250 ($12,000).
The U.S. arm of the business is registered to an address in Sheridan, Wyoming which acts as the official address for dozens of companies which have no physical location.
The building on North Gould Street has been the subject of both local and international reporting, due to the number of scams using the address.
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