Cryptocurrency lender Celsius suspends withdrawals, transfers citing ‘extreme market conditions’ – TechCrunch

C Network, one of the largest crypto lenders, told customers on Sunday night that it is suspending withdrawals, swaps and transfers between accounts in a move that has sparked controversy. discussion and caused the company’s token price to drop by 60% in the past one hour as low as 19 cents.

“We are taking this action today to put C in a better position to respect, over time, its withdrawal obligations,” Written Celsius, which includes stablecoin issuer Tether International, growth fund WestCap Group and Canadian pension fund Caisse de Dépôt et Placement du Québec among its investors.

“Action for the benefit of the community is our top priority. To support that commitment and to comply with our risk management framework, we have activated a provision in our Terms of Use to allow this process to take place. Celsius has valuable assets and we are working diligently to meet our obligations.”

C, was valued at $3.25 billion when it extend Its Series B funding round “over-subscribed” amounted to $750 million in November, allowing users to deposit their Bitcoin, Ethereum, and Tether and receive weekly interest payments. Depending on the period and the token, the platform offers an interest rate of 18% a year. On its website, Celsius says 1.7 million people call “Celsius their home for crypto.”

The announcement comes after one of the brutal weekends in the crypto market that saw hundreds of millions of dollars in liquidations. At the time of publication, Bitcoin was trading at around $25,585 and Ethereum at $1,346, some of the lowest levels in over a year. Other well-known crypto projects including Solana, BNB, and FTT have also shut down.

Cryptocurrency lenders are facing increasing scrutiny after the demise of Terraform Labs Luna and its sister token UST last month. Alex Mashinsky, chief executive officer of Celsius Network, has tried to reassure clients in recent weeks, saying they can withdraw their assets at any time and questioning skeptics. The company also recently launched a recurring promotion, which gives customers a bonus if they transfer assets to Celsius’s account and helps with positions for up to 180 days.

But degrees Celsius have also struggled with high sales in recent months. The lender says on its website that it has assets of about $3.8 billion, down from the $24 billion it disclosed at the end of December 2021.

“The beauty of what C manages to do is we make a profit, we pay it to people who could never do it themselves, we take it from the rich and we beat the index . That’s like going to the Olympics and winning 15 medals in 15 different fields,” Mashinsky said in a video streamed in December.