Decentralized yield protocol Neutrl disclosed a problem with a single position in its strategy, impacting liquidity for a portion of the protocol’s reserves. The team consulted legal counsel and promptly halted the affected smart contract.

The protocol said it currently holds roughly $27 million in liquid assets, along with unliquidated strategy positions and related gains or losses. It cannot confirm the recovery timeline, total recoverable amount, or recoverable value at this time.

To address user liquidity needs, Neutrl will introduce an early redemption mechanism for NUSD and sNUSD holders and said it will treat all holders equally. The target window is early September, subject to the deployment of a new redemption contract and the progress of independent audits and legal and financial reviews; the schedule may change. The team advised against trading NUSD or sNUSD during the assessment period to avoid affecting recovery arrangements.