Topic: Crypto lender Celsius mulls possible restructuring amid financial woes - page 10. (Read 3112 times)

You know they are often times masquerading as decentralized services that support DeFi, so most people believe they are really working like that and they still own their coins  
Most of them have their own tokens that further confuses people into thinking they are some kind of revolutionary blockchain solutions.
 
For example this is what we can see on crypto.com website:


https://crypto.com/

This is example from Celsius website, how they play with words decentralied/centralized, and they even added Chainalysis in the mix for ''safety'':


https://celsius.network/

I am sure situation is very similar with all other platforms like this, but I guess it's fine if you pay a bunch of money to Matt Damon from advertisement...

Crypto.com slashed all their rewards and interest rates whilst simultaneously hiking deposit fees, conversion fees, withdrawal fees, and so on, so they are obviously experiencing some issues as well.

Everyone should have left Robinhood a long time ago, as soon as they started freezing regular users' accounts and preventing them from selling shares so they could insider trade and protect the interests of their hedge fund backers. They are incredibly shady.

The list would be very short. Only use decentralized exchanges which let you keep custody of your own coins at al times. Whenever you give up custody to any centralized exchange or lending platform, your coins are at risk.

I don't know about that but I am starting to think of all other companies like Celsius, and first thing that pops in my mind is Crypto.com (nobody is talking about it) and maybe even Robinhood.
Maybe we should create a list of all alternative similar platforms, and warn people to stay away and withdraw any coins they have there.
Same thing could apply for all centralized exchanges, even those with highest trading volume like Kucoin, Bitfinex, Binance, etc.
Withdraw your coins and don't wait for them to start firing people and blocking accounts.

In other words, 3AC does something dumb with their money, goes down, and takes most of their lenders down with them because they were too incompetent to collateralize their loans, themselves almost single-handedly dragging the market prices down with them.

Do we know if Celsius's loan to 3AC, which was the catalyst for their collapse, was over collateralized, under collateralized, or not collateralized at all? We know that Voyager had a $654 million uncollateralized loan to 3AC which was what prompted their collapse, so it is not unreasonable to think that Celsius was in a similar situation, as Celsius don't exactly strike me as a particular risk averse company. If that is the case, then it was the lack of collateral, rather than the falling value of collateral which did exist, which caused them to collapse.

I think its a given right now that they will not be honoring all user deposits in full. With entities such as Goldman Sachs preparing to scoop up their assets at a huge discount, Celsius will not have enough money to pay all their secured depositors, let alone their users who are unsecured deposits and are last on the list to receive any compensation.

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Celsius have also just fired 25% of their staff: https://www.theblock.co/post/155647/crypto-lender-celsius-dismisses-a-quarter-of-its-employees-calcalist

When you have $100 million worth of a particular altcoin, you cannot easily sell that altcoin at market rates, so if the price of that altcoin drops far enough to force many liquidations, Celsius will have no way of receiving sufficient money to cover the loan amount.

The halt in withdrawals happened at a time in which the price of ~all crypto was falling/crashing. This makes me tend to believe this is more of an issue of Celsius being a failed bank, and not them putting customer money in exotic "investments".

The lack of transparency is likely something that is being done on the advice of their lawyers. My guess is that any solution is going to involve money being injected from a third party, either in the form of debt or in the form of someone buying (part of) Celsius, unless they end up not being able to honor all deposits in full.

Yeah. Getting heavy 2018 vibes when ICOs were dying left right and center. Everyone gets sucked in with unrealistic promises of huge gains, a small number of creators of such projects/platforms run away with everybody else's money, while the vast majority of average users lose everything.

We are assuming it is only going to be these smaller platforms which collapse, but I wouldn't be putting any money on larger exchanges either. They (presumably) have better business practices, but they aren't immune to the current climate either.

I hope you are telling them to get their coins out and in to their wallets ASAP. Nexo and BlockFi users have been handed a lifeline here by Celsius and Voyager collapsing first. They would be insane to ignore it. Best case scenario it's all fine and they lose out on a few months of interest. Worst case scenario they lose everything.

They are dropping like flies, if it weren't for so many people that are going to lose a ton of money this would have been real popcorn material.

Everyone can remember the Defi hype, the old banks were obsolete, they were still standing because the gubbermint was involved, fractional reserves, all that will change with the new model, decentralized finances, secure finances, no more scheme, everything will be public, it will be ...
Well, fast forward two years and it has turned into a pile of crap, and the only thing that keeps it meaning a larger fuckup than the 2007 crisis is that fortunately for us they didn't have that much money in the first place and they were playing with "only" a few billion


Me neither but I do hope they come out of this unscratched, I know guys that have money there, I have friends that have money there and I'm really fed up with all this drama of people losing money everywhere.

Well, let's see how that goes. After his $485 million loan to Voyager not even two weeks ago, Voyager have now suspended all trading and withdrawals: https://www.investvoyager.com/blog/voyager-update-july-1-2022/

No doubt this will pan out the exact same way as it did for Celsius. A "temporary freeze" will drag on and on with little being said from Voyager, followed soon by word that FTX, Goldman Sachs, or some other institution is quietly preparing to buy out all their assets and their users will lose everything.

I wouldn't trust Nexo either right now. I wouldn't trust any centralized platform. If your coins aren't in your own wallet, then there is a high risk that very soon they will bought out by some fiat bank for pennies on the dollar and you will lose everything.

Their strategy is to recover the losses through pump and dump schemes using CEL token and altcoins in general. In other words: gambling with investors' funds.

Maybe if they tried to negotiate honestly and realistically with another companies, like NEXO proposed to do as soon as withdrawls were stopped, it would have a happy ending for everyone, instead of risking more funds to recover a huge amount of money.

Also, days ago some crypto influencers and enthusiasts said on twitter Machinsky attempted to flee from US to Israel, but was halted at the airport by authorities. I don't know if it's true, since nobody provided any proofs, while at same time Machinsky himself didn't deny anything and is offline from social medias for 15 days already.

@uneng. There will be some companies in the cryptospace that cannot be saved. Also, there are some speculations that Celsius's CEO, Alex Mashinsky might have been dumping CEL tokens on the market.

Another head shaking information on Celsius is their head of institutional lending is Jessica Khater who is a former pornstar or someone who has done porn before working for Celsius.



Due to public revelations by Mr. Mashinsky, we uncovered a network of wallets that appears to be under his direct control. Some of these wallets were involved in the earliest transfers of CEL tokens. One of the wallets, as we have shown previously, was used by Mr. Mashinsky to participate in multiple ICO rugpulls. All told, these wallets have seen nearly 200 million CEL pass through them en route to various destinations. Alex Mashinsky owned at least 77 million CEL tokens in 2019. At least 19 million were sold either via the Liquid exchange or through decentralized exchanges (DEXs) like Uniswap. Alex was a major liquidity provider for CEL markets on DEXs using these wallets.

Source https://dirtybubblemedia.substack.com/p/hodl-for-thee-but-not-for-me

FTX Passed on Deal to Purchase Celsius Due to Deficient Balance Sheet: Report

Well, after this refusal, at least the public can finally have a clue of how bad things are inside Celsius. Is this 2$ billion loss recoverable?

I suppose if the platform was serious about getting back on track the first thing they should have done was to stop paying interest to customers. The fact they keep paying weekly interest on accounts while having a negative balance of 2$ billion dollars possibly means they are only buying time.

@ o_e_l_e_o. I only read the news now hehe. It appears Sam Bankman Fried's tactic to become the king of the cryptospace in the bear market is to make money by liquidating everyone through their market maker and cryptofund called Alameda Research then buy them out with the billions they made in liquidation profits hehehe.

It will not come as a shock if he also begins to go after those exchanges that might fail in America. Coinbase and Binance.us.



FTX’s $250 million credit facility offer – if inked as initially proposed – stood to effectively wipe out all BlockFi shareholders, including Morgan Creek Digital, the firm told its investors.

Morgan Creek Digital, co-founded by Anthony “Pomp” Pompliano, is one of BlockFi’s largest investors. The firm has participated in BlockFi’s Series A through D fundraising rounds across three funds and a special purpose vehicle (SPV), a type of investment structure that allows an investor to invest in a single company.

Source https://www.coindesk.com/business/2022/06/25/morgan-creek-is-trying-to-counter-ftxs-blockfi-bailout-leaked-call-shows/

I doubt it. Goldman Sachs will be buying up the assets at a huge discount. That $2 billion Celsius raise will then be used to pay off some of their debts to their investors. It any bankruptcy case, secured creditors come first. Secured creditors are all the financial institutions and venture capitalists which provided the bulk of Celsius' funding. That $2 billion will be entirely exhausted paying back these entities, with still a significant outstanding debt. Regular users are unsecured creditors, and will come last. I doubt any regular user will see even a single cent of this Goldman Sachs money. As I noted in another thread, highly ironic that Celsius' tagline was "Unbank yourself", and everyone who believed that is going to end up with all their coins in the possession of a fiat bank.

Not saving it, but buying it out. Turns out the $250 million bailout FTX offered was in exchange to be able to acquire BlockFi at essentially no cost and wipe out all their other shareholders. Morgan Creek Digital - one of BlockFi's shareholders who are facing losing everything - and now trying to put together their own bailout for BlockFi instead. Either way, if for some insane reason you still have funds on BlockFi, you should get them out now.

@stompix. Okay then it appears that speculations on Goldman Sachs and Sam Bankman Fried information exchange might really be true hehe. A similar comment in social media was made by someone that FTX is not saving Blockfi. Sam is only making Sam moves by taking over for the price of zero. This was not very shocking after knowing more about Sam.

Not at all, and it's in the article also, it's not a bailout it's a garage sale, not a helping hand but a pack of hyenas roaming around.



If we take May the 1st, then those assets, considering other coins have ump harder than bitcoin are only 6 billion, 2 billion losses for investors bets case scenario, worse maybe 4-5. If the assets were valued at 12B in middle may then maybe they will not go bankrupt at all, with only a few hundred million that they can solve by creating a new scheme, as it's the norma when it comes to them.

Hopefully, they have enough money to pay back the ones that lend them coins, it's really an ugly situation.

News update. It appears Goldman Sachs might bail out Celsius. This comes after some news that Blockfi will be bailed out by FTX. I predict those other big cryptolenders like Genesis and Voyager will also have their own bail outs from other cryptowhales and bankers. Changpeng Zhao, Justin Sun, Arthur Hayes and JPMorgan will be in the news hehehe.



Goldman Sachs is looking to raise $2 billion from investors to buy up distressed assets from troubled crypto lender Celsius, according to two people familiar with the matter.
The proposed deal would allow investors to buy up Celsius’ assets at potentially big discounts in the event of a bankruptcy filing, the people said.

Source https://www.coindesk.com/business/2022/06/24/goldman-sachs-raising-funds-to-buy-celsius-assets-sources/



Also, if everyone pays attention to the news, you would know who might have been talking to Goldman Sachs to bail out Celsius. The information exchange might be going back and forth between Goldman Sachs and FTX. This article is from April.



Goldman CEO David Solomon met with Sam Bankman-Fried in the Caribbean last month to discuss advisory services for FTX, new report says

Source https://markets.businessinsider.com/news/currencies/sam-bankman-fried-goldman-sachs-ceo-ftx-ipo-fund-raising-2022-4

I’m not overly thrilled with the way Bitcoin is used that way, and not as a currency as it should be - but Saylor firmly believes in what it does and hasn’t changed his mind even in moments when many have shown how hypocritical they really are. Musk has done great damage to Bitcoin with its acceptance and then withdrawal of the payment option, and I believe this has influenced many to have a negative view of Bitcoin as a currency because “transactions are dirty”.

Furthermore, if you look at just how much damage Celsius has done not only in terms of financial damage but also by throwing a negative light on Bitcoin, then Saylor is still on the positive side - and as far as politicians are concerned, their work is far dirtier than any mining and scams like are happening in the world of cryptocurrencies.

I honestly would like to see Saylor's investment in bitcoin to be an inspiring success story, however, I cannot stop myself from being skeptical. I speculate him to be more dangerous than Elon Musk, very much similar to those politicians who always make themselves appear good in front of the public or similar to those scammers who want themselves to appear honest.

Over bitcoin, Celsius was paying up to 8,53% annually (if receiving rewards in CEL token) or up to 6,50% (if receiving "in-kind" rewards). Moreover, rates could change from week to week, depending the market conditions and demands. The more borrowing demand there was for a currency, more interest they would pay to investors on that week. So the system was dynamic and constantly changing, what I consider really good for the sustainability of the platform. And yes, theoretically it could be legit, because the lending business is a profitable one.

The problem is what they have been doing on the backgrounds and don't share with the community they are constantly saying to be acting in the interest of as their main priority...

I'm one of the 1,7 million investors of the platform who injected over 5 billion dollars on their hands. Things aren't looking good, because there isn't transparency, the CEO has disappeared from social medias, all messages coming from them are evasive and say nothing enlightening, sock puppets accounts on twitter and reddit keep pushing an "us against them" narrative to protect Celsius, just like Mashinsky has always done and inexplicably CEL's price is doing well right now, pumping decently, what indicates the platform is burning investors' funds to boost their native token.

Anyway, they can't pull the rug without consequences. It's not an anonymous virtual investment scheme and there are too many people and too much money involved on it.