Less Worry: Celcius paid off its $114 million Bitcoin-backed loan in 24 hours.

tygeade

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Quote from: tbct_mt2 on July 08, 2022, 04:25:35 AM

DeFi, lending and high APYs, all will be liquidated and bankrupted in bear market. Especially if their portfolios have crytocurrencies that have x100, x200 in 2020 and 2021 bull run and they have yet cashed it out to good stable coins.

Things for them will be worse if they used too high leverage in bull run and did not cut their positions to safer leverage.

Unfortunately those lending places do not realize the default rate because they are taking all the money upfront as a collateral, hence why they are not really lending. It's exchanging with extra steps and nothing more.

If I give you 120 dollars worth of LTC today, and get 100 dollars worth of BTC, then we just made an exchange, sure I could pay you back the 100 dollar worth of btc back, and then get the 120 dollar worth of ltc in my account again, but that's literally trading and nothing more, useless. This is why I doubt that all those "defaults" matter to them, they won't crash down to nothing, why? Because they already took so much upfront.

franky1

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Quote from: JohnBitCo on July 08, 2022, 01:14:56 PM

Quote from: DeathAngel on July 08, 2022, 01:07:50 PM

Things like this make you wonder if this was all planned from the beginning. Maybe I’m being cynical but cause a capitulation event, crash the price, buy the bottom & laugh at all the normies.

So you think that Celcius Network did all this drama to dump the bitcoin price but this is at the cost of their own reputation.

if they did do it to 'dump' the market. then they should have been smart and short the opportunity. by buying up more coin at the lower price to give back to investors. and keep the excess win.

but instead, the evidence is that by locking investors out of withdrawals seemed more like they 'spent' the coins outside of their promises thus didnt have the reserves to honour investors deposits. and thus did not short the market. nor had any spare fiat from any coin sells on markets to buy back coins after bad news to make whole again.

requiring a fresh injection of funds from G.sachs shows they lacked coins and lacked fiat. and the questions then become where did all that stuff go in the first place.

NotATether

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Quote from: CarlB on July 06, 2022, 03:03:51 AM

Why is Celsius paying-off debt?

Because they used customers' money to give loans to high-risk financial institutions, those corps defaulted on their loans, so Celsius has almost no money for its (protected) institutional clients to withdraw as well as for the rest of their users.

noormcs5

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Quote from: 2stout on July 08, 2022, 04:38:56 PM

Quote from: JohnBitCo on July 08, 2022, 01:14:56 PM

Quote from: DeathAngel on July 08, 2022, 01:07:50 PM

Things like this make you wonder if this was all planned from the beginning. Maybe I’m being cynical but cause a capitulation event, crash the price, buy the bottom & laugh at all the normies.

So you think that Celcius Network did all this drama to dump the bitcoin price but this is at the cost of their own reputation. Do you think that even if they pay back the debt, people will still trust them? Will they get the same investments as before? The answer is NO.
No company will do such fake announcements to dump the bitcoin price , as bitcoin will survive but that company will never be able to survive for long term.

Hard to see that this was planned by Celsius intentionally as things are pointing toward greed, over collateralization, and over exposure to luna. However, you did have entities and savvy buyers that took advantage and bought the dip.

Anything could have happened. If you remember there are so many stories of exchange hacks and most of them are insider hands involved and Celsius / Luna can be no different.

The worst thing is that all of these news come out in the phase when bitcoin is already dumping and is in a bear market. Such news creates more panic and fear.

2stout

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Quote from: JohnBitCo on July 08, 2022, 01:14:56 PM

Quote from: DeathAngel on July 08, 2022, 01:07:50 PM

Things like this make you wonder if this was all planned from the beginning. Maybe I’m being cynical but cause a capitulation event, crash the price, buy the bottom & laugh at all the normies.

So you think that Celcius Network did all this drama to dump the bitcoin price but this is at the cost of their own reputation. Do you think that even if they pay back the debt, people will still trust them? Will they get the same investments as before? The answer is NO.
No company will do such fake announcements to dump the bitcoin price , as bitcoin will survive but that company will never be able to survive for long term.

Hard to see that this was planned by Celsius intentionally as things are pointing toward greed, over collateralization, and over exposure to luna. However, you did have entities and savvy buyers that took advantage and bought the dip.

2stout

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Quote from: Rikafip on July 08, 2022, 12:29:34 PM

Quote from: 2stout on July 08, 2022, 12:43:32 AM

We already have a small bump in price going on.

I think that this price increase is more like short squeeze than anything else, I don't think that we are out of the woods yet. Regarding Celsius, it is a good news but I think that people who have/had money there are still pretty far away from the moment when they gonna get their money back. If that happens at all.

In other news, ex Celsius employee is suing them and accusing of being a ponzi scheme.

Quote from: https://coinmarketcap.com/alexandria/article/ex-celsius-network-employee-takes-embattled-crypto-lender-to-court

The lawsuit accuses the company of leveraging deposits from customers to "manipulate cryptoasset markets" — and further putting funds at risk by failing to introduce "basic accounting controls."

It goes on to claim that hundreds of thousands of people have been affected by Celsius Network's actions — with withdrawals suspended for almost four weeks.

The documents also take aim at the company's business model, where deposits were used to generate income by lending crypto to others — and investing funds in the crypto markets.

It's alleged that Celsius had no "unified, organized or overarching investment strategy for these deposits" — and "they were desperately seeking a potential investment that could earn them more than they owed to depositors."

Agree we are not out of the woods yet but perhaps the <$20k days are behind us. This lawsuit should be interesting, but baring an absolute victory, this will most likely be a death blow. Even in the case of absolute victory, Celsius may already be mortally wounded now.

Hispo

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Maybe next time a company offers over 10% "risk free" APY to their costumers they should mention the little detail that in order for them to comply with those numbers they will literally gamble all people's money within exchanges, of course using leverage. Huh

Even if they manage to recover from this downside and they get their money back to feed their costumers withdraval orders, the amount of money they will have to give back may end their business or at least minimize their staking value to all time lows. This is a centralized service and all that keeps together a service of this nature is trust and reputation, Celsius has lost both and it is unlikely things will ever be the same for them after this.

The important thing is people getting their money back, of course.

JohnBitCo

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Quote from: DeathAngel on July 08, 2022, 01:07:50 PM

Things like this make you wonder if this was all planned from the beginning. Maybe I’m being cynical but cause a capitulation event, crash the price, buy the bottom & laugh at all the normies.

So you think that Celcius Network did all this drama to dump the bitcoin price but this is at the cost of their own reputation. Do you think that even if they pay back the debt, people will still trust them? Will they get the same investments as before? The answer is NO.
No company will do such fake announcements to dump the bitcoin price , as bitcoin will survive but that company will never be able to survive for long term.

DeathAngel

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Things like this make you wonder if this was all planned from the beginning. Maybe I’m being cynical but cause a capitulation event, crash the price, buy the bottom & laugh at all the normies.

Rikafip

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Quote from: 2stout on July 08, 2022, 12:43:32 AM

We already have a small bump in price going on.

I think that this price increase is more like short squeeze than anything else, I don't think that we are out of the woods yet. Regarding Celsius, it is a good news but I think that people who have/had money there are still pretty far away from the moment when they gonna get their money back. If that happens at all.

In other news, ex Celsius employee is suing them and accusing of being a ponzi scheme.

Quote from: https://coinmarketcap.com/alexandria/article/ex-celsius-network-employee-takes-embattled-crypto-lender-to-court

The lawsuit accuses the company of leveraging deposits from customers to "manipulate cryptoasset markets" — and further putting funds at risk by failing to introduce "basic accounting controls."

It goes on to claim that hundreds of thousands of people have been affected by Celsius Network's actions — with withdrawals suspended for almost four weeks.

The documents also take aim at the company's business model, where deposits were used to generate income by lending crypto to others — and investing funds in the crypto markets.

It's alleged that Celsius had no "unified, organized or overarching investment strategy for these deposits" — and "they were desperately seeking a potential investment that could earn them more than they owed to depositors."

tbct_mt2

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Quote from: davis196 on July 08, 2022, 12:11:28 AM

This isn't enough for pumping the cryptocurrency prices and restoring confidence back into the crypto markets. It's not just Celsius. Companies like Three arrows capital and Voyager are having difficulties as well. The companies in the entire crypto indsutry are more or less connected to each other. If one goes down, it causes problems for the others.

When people get hurt too much, their soul is hard to be healed. Not only their soul but also their capital vanishes a lot and it is not easy to recover it to their initial capital when they get in the market.

With this hurt feeling, they won't be ready to touch crypto in near future, if they mostly got rekted in this market. For people who are gamblers, they still gamble again but gamblers don't have ability to control themselves and they won't have happy ending.

Quote

Those centralized crypto financial services with their high leverage are like house of cards or a domino. If one falls, others will follow. The good thing about this is that more crypto users will learn the meaning of "not your keys, not your coins" and stop trusting centralized services, that offer high rewards for high risk.

DeFi, lending and high APYs, all will be liquidated and bankrupted in bear market. Especially if their portfolios have crytocurrencies that have x100, x200 in 2020 and 2021 bull run and they have yet cashed it out to good stable coins.

Things for them will be worse if they used too high leverage in bull run and did not cut their positions to safer leverage.

2stout

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Quote from: davis196 on July 08, 2022, 12:11:28 AM

Quote from: 2stout on July 07, 2022, 11:51:37 PM

This will be helpful as far as instilling confidence back into the crypto markets, which should help stabilize things and perhaps even bump up the price. But for Celcuis it will be a longer climb to make as the trust was broken and this is hard to fully gain back.

Nope. This isn't enough for pumping the cryptocurrency prices and restoring confidence back into the crypto markets. It's not just Celsius. Companies like Three arrows capital and Voyager are having difficulties as well. The companies in the entire crypto indsutry are more or less connected to each other. If one goes down, it causes problems for the others. Those centralized crypto financial services with their high leverage are like house of cards or a domino. If one falls, others will follow. The good thing about this is that more crypto users will learn the meaning of "not your keys, not your coins" and stop trusting centralized services, that offer high rewards for high risk.

We already have a small bump in price going on. I agree it's more than just one company but you also have the dude from FTX and some other companies that will prop up, shore up some of these companies that got in over their heads, which will also stop some of the crypto market bleeding because they don't want to keep losing- to your point of how connected these companies are. The whole Luna debacle, unexpected at the time for the most part, set off a chain of unfortunate but somewhat expected events. Do I personally think this enough for pumping- no, but for quite a few investors it is even if it's false hope so long as it appears as light at the end of the tunnel or a path forward. I don't represent the typical investor, but it seems to be enough to them for pumping and hence might have a bit to do with what we are seeing in regards to price movement.

davis196

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Quote from: 2stout on July 07, 2022, 11:51:37 PM

This will be helpful as far as instilling confidence back into the crypto markets, which should help stabilize things and perhaps even bump up the price. But for Celcuis it will be a longer climb to make as the trust was broken and this is hard to fully gain back.

Nope. This isn't enough for pumping the cryptocurrency prices and restoring confidence back into the crypto markets. It's not just Celsius. Companies like Three arrows capital and Voyager are having difficulties as well. The companies in the entire crypto indsutry are more or less connected to each other. If one goes down, it causes problems for the others. Those centralized crypto financial services with their high leverage are like house of cards or a domino. If one falls, others will follow. The good thing about this is that more crypto users will learn the meaning of "not your keys, not your coins" and stop trusting centralized services, that offer high rewards for high risk.

2stout

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This will be helpful as far as instilling confidence back into the crypto markets, which should help stabilize things and perhaps even bump up the price. But for Celcuis it will be a longer climb to make as the trust was broken and this is hard to fully gain back.

ChrisPop

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I don't know what are the plans of Celsius' management, but it is a fact that once a brand has lost credibility, it is extremely hard or even impossible to grow it back and it comes with a massive bill which I'm not sure who is willing to bet with.

GS are not fools, if they're getting into a business/partnership they know what they have gotten into and they should have a well-planned strategy.

justdimin

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Quote from: Mark301 on July 06, 2022, 02:46:24 AM

Users of the crypto lending platform have finally felt some relief following Celcius Network's announcement that it has paid a total of $114 Million of its Bitcoin loan in the last 24 hours, lowering its liquidation price to $4,967

This means that the Bitcoin price must fall below $4,967 before Celcius is liquidated.

Source/Continue Reading: https://mycryptoparadise.com/less-anxiety-as-celcius-paid-114-million-of-its-bitcoin-backed-loan-in-24-hours/

Honestly, not many expected it to be like this. During all of this chaos when everyone and everything looks to be going crazy and nobody knows what’s going on. It’s quite good to see them doing at least a bit decent. I have to say the best thing to do right now would be slowing down a bit, and checking what Celcius managed to do. This isn't a simple task neither, it’s a task that has happened very very well and it’s a big deal.

I know that some people who were inside probably knew it, if you are invested into it, you follow it and you would expect it. But, for people who are outside and not really aware of what’s going on inside Celcius, we gotta say it’s a big damn achievement. Certainly, a reason to get a bit of it.

franky1

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Quote from: CarlB on July 06, 2022, 09:29:48 AM

Same here. If they file chapter 11, G.Sachs will lose big, right?

G.sachs is not claiming to be a owner of celsius. its claiming to be a loan giver to celsius. however if anyone in business knows G.sachs arranged the management switchover.
the new manager is a known 'liquidator" of weak companies. but even that is not an absolute. some liquidators also know how to recover companies.

as for g.sachs. before filing bankrupcy (via the puppetstrings) if that was the planned route they choose to go, g.sachs will pull out any good assets from celsius. and put in any bad assets g.sachs has. .. and then pull the string

but at this present moment. it can go both ways. a plan to close or grow celsius

CarlB

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Same here. If they file chapter 11, G.Sachs will lose big, right?

sbrys

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I wonder about the strategy of Goldman.

Putting this kind of money in a company with a ruined reputation.

They could just have invested in Bitcoin if they wanted to get more into crypto

Beparanf

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Quote from: Mark301 on July 06, 2022, 02:46:24 AM

Users of the crypto lending platform have finally felt some relief following Celcius Network's announcement that it has paid a total of $114 Million of its Bitcoin loan in the last 24 hours, lowering its liquidation price to $4,967

This means that the Bitcoin price must fall below $4,967 before Celcius is liquidated.

Source/Continue Reading: https://mycryptoparadise.com/less-anxiety-as-celcius-paid-114-million-of-its-bitcoin-backed-loan-in-24-hours/

The main question here is where the heck they get the funds for that loan repayment. There’s a possibility that they are using the balance of the user trapped on there DeFi to extend there liquidation and to attract more customers by building again there trust. I’m still not convinced enough about this news and probably truth will come out on the following days or weeks once crypto slide down further.

Topic: Less Worry: Celcius paid off its $114 million Bitcoin-backed loan in 24 hours. (Read 433 times)