Celsius, a crypto lending firm, has announced the suspension of withdrawals and transfers on its platform, attributing its decision to the current market conditions, which have vastly affected the price of Bitcoin (BTC), Ethereum (ETH), and other top cryptocurrencies.
The firm, which sources claimed only has a few more weeks-worth of financial resources to support customer withdrawals just about a week ago, noted in a tweet today:
“@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.”
.@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
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As once reported by Financial Times, the firm led by Alex Mashinsky had about $12 billion in customer assets as of May. And the number of its customers stands around 1.7 million.
In a note to clients captioned in the announcement, Celsius stated:
“Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, Swap, and transfers between accounts. We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations.
“Acting in the interest of our community is our top priority. In service of that commitment and to adhere to our risk management framework, we have activated a clause in our Terms of Use that will allow for this process to take place. Celsius has valuable assets and we are working diligently to meet our obligations.
“We are taking this necessary action for the benefit of our entire community in order to stabilize liquidity and operations while we take steps to preserve and protect assets. Furthermore, customers will continue to accrue rewards during the pause in line with our commitment to our customers.”
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This announcement greatly affected the price of the Celsius token moments later. The price of the token subsequently fell by 45% to $0.21.
The new development is the representation of the current market distress, which has dipped the prices of most coins in the market, especially the two largest cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH).
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