The Celsius crypto-lending platform paused withdrawals, swaps and transfers between accounts due to extreme market conditions. The project’s token reacted with a drop.
.@CelsiusNetwork is pausing all withdrawals, Swap, and transfers between accounts. Acting in the interest of our community is our top priority. Our operations continue and we will continue to share information with the community. More here: https://t.co/CvjORUICs2
— Celsius (@CelsiusNetwork) June 13, 2022
“We understand that this is unwelcome news, but we believe that suspending withdrawals, swaps and transfers between accounts is the most responsible action we can take to protect our community,” wrote the Celsius team.
This occurred amid a decline in the price of Bitcoin to around $25,000. Ethereum prices fell to $1,300.
According to journalist Colin Wu, over the past three days Celsius transferred about 104,000 ETH to the FTX exchange. The platform also sent about 9,500 WBTC to FTX.
Update: Celsius has transferred about 104,000 ETH to FTX in the past three days, including about 50,000 ETH today, 12,000 ETH yesterday, and 42,000 ETH the day before yesterday. In addition, Celsius also transferred about 9,500 WBTC to FTX today.https://t.co/RaiJTJIVm9 https://t.co/1RQaa9fT3u
— Wu Blockchain (@WuBlockchain) June 13, 2022
In the wake of the events, the CEL token fell from around $0.475 to as low as $0.09. After a rebound, the asset was trading near $0.18.
Celsius’s competitor, Nexo, said it was prepared to acquire all of its lending assets.
Nexo is in а solid liquidity and equity position to readily acquire any remaining qualifying assets of Celsius, mainly their collateralized loan portfolio. We are putting together an offer to Celsius to that accord and will communicate it publicly. 5/
— Nexo (@Nexo) June 13, 2022
“The Nexo team has never celebrated the failure of any blockchain business, but we warned that adopting a sustainable business model built on prudent risk management is what sets Nexo apart and enables us to maintain financial stability in any market environment,” the project stressed.
In April, Celsius paused payments on the Earn product for new US users.
In May, Celsius founder and CEO Alex Mashinsky blamed the market downturn for cryptocurrencies “Wall Street sharks.”