in

Crypto Hot News This analyst decodes the mystery behind Celsius’ crippling meltdown

Hot Crypto News Today This analyst decodes the mystery behind Celsius’ crippling meltdown You Must Read To Get More Information For Trading and Investment.

It is true the bear market is raining down on the entire cryptocurrency market. But the devastation has been more painful for some. Celsius is certainly a leading highlight of the crippling crypto institutions that is rumored to be edging towards insolvency.

An overheated matter

Celsius had more than $8 billion lent out to clients and $12 billion in assets under management by May 2022, according to the company. However, rumors about insolvency started spreading after it announced the freezing of account transactions.

Celsius announced on 12 June evening that withdrawals and transfers between accounts will be frozen, citing ‘extreme market conditions’. This move saw over $11.8 billion in customer assets being frozen. Five days in and the assets are still not released amid a huge crypto market turmoil.

CEO Alex Mashinsky even confirmed that exposure to the Terra debacle was ‘small’ after his firm’s early exit.

So where did it all go wrong for Celsius?

The major error appears to be the investing customers’ ETH in Lido Finance as staked Ethereum or stETH. However, the crypto crash led to the massive dumping of stETH and 1 stETH was no longer redeemable for one ether. This jeopardized the position of Celsius.

“Celsius promised customers between 6% and 8% returns on ether deposits. It had at least $450 million in stETH in its primary DeFi wallet, but likely has more stored elsewhere,” according to Andrew Thurman, Analyst at Nansen.

The clock is ticking for Celsius right now but a prominent analyst has a different theory for its crisis.

More twists in this tale

Crypto analyst “Plan C” alleges a different theory for the Celsius crisis. The analyst believes that two key players namely, FTX and Alameda Research, conspired to the demise of Celsius. He cut open the wounds of the Terra crash when TFL CEO Do Kwon was looking for bailouts. CEO Mashinsky confirmed in a tweet that Celsius is not a part of it.

While Celsius got out, FTX and Alameda were stuck in the Luna ‘bailout’. As per ‘Plan C’, they lost huge amounts of money holding “UST and locked Luna bags”.

The analyst then regards the track record of Alameda Research as evidence of potential wrong-doings. In the same thread, there is on-chain data claiming Alameda Research did swap around 50,000 stETH to ETH. This liquidation started piling pressure on Celsius and eventually, market volatility took charge.

Crypto Hot News This analyst decodes the mystery behind Celsius’ crippling meltdown

Fast forward to today, we now have a crypto market at one of its lowest points.

Read more Crypto Hot News here.
Watch free hot girl asia stock quality Photos on hotgirl.asia Crypto Hot News This analyst decodes the mystery behind Celsius’ crippling meltdown

What do you think?

Written by thegamefi

Leave a Reply

Your email address will not be published.

GIPHY App Key not set. Please check settings

    Crypto Hot News How Tron [TRX] is managing to keep its boat afloat amid looming depegging fears

    Crypto Hot News Cardano [ADA] bulls set their eyes on these two short-term resistances