What REALLY Happened With Celsius?! What We Know!!

As the crypto collapse continues many Crypto companies have started cutting Their workforces some crypto companies Have gone under and a few other crypto Companies are expected to follow suit Celsius is a crypto company that falls Into the latter most category and Suspicions about its insolvency have Been circulating ever since it paused Withdrawals for its 1.7 million users Earlier this month Today i’m going to give you a bit of Background about celsius tell you what i Think is going on behind the scenes Based on the best evidence we could find And explain what it could all mean for The cell token [Music] Before we talk about cell i need to make Sure i don’t end up in a cell if you’re Here for financial advice there’s no Chance in hell education and Entertainment are the only things i can Tell so please contact a financial Advisor if you want your portfolio to Swell Now if this is the first time you see me My name is guy and i’m here to show you That crypto is about more than greed i Do that by creating high quality crypto Content for free Coins tokens news reviews anything and Everything you need If this is what you want to see on your

Youtube feed the subscribe button and Notification bell are what you should Heed Now i know my rhymes are hilarious but It’s about time we got started with Celsius If you’re unfamiliar with celsius here’s What you need to know celsius also known As celsius network is a centralized Crypto lending crypto borrowing crypto Saving and crypto trading platform based In the united states Celsius was founded in 2017 by daniel Leon nuke goldstein and alex maczynski Daniel spent most of his career in the Telecommunications industry holding Multiple executive positions at multiple Companies Daniel currently serves as the chief Strategy officer of celsius Nuke great name spent most of his career Working as a software engineer and he Has likewise held many executive Positions at multiple companies Nuke currently serves as the chief Technology officer of celsius now alex Spent most of his career in the Telecommunications industry where he Helped developed the voice over internet Protocol or voip which is used by most Applications today for audio and video Content Alex currently serves as the ceo of Celsius and has basically been the face

Of the company Now celsius got off the ground with the Help of an initial coin offering it Conducted for its sell token in early 2018. this saw 325 million sell tokens sold for 20 Cents each to pre-sale participants and For 30 cents each to crowdsale Participants The cell ico brought in roughly 50 Million dollars Now 50 percent of cell’s initial supply Of 650 million was sold during the sell Ico nineteen percent of cell supply went To the team two percent went to advisors Another two percent went to partners and The remaining 27 percent went into the Celsius treasury Vesting for all sell tokens ended in September last year Now celsius has since raised an Additional 810 million dollars 750 Million of which was raised last autumn In an expanded funding round that Included canada’s second largest Government pension fund Ironically that same pension fund said At the time that it would quote Absolutely not Be investing in bitcoin Now like the other platforms in its Niche celsius was known for the Incredibly high interest rates it Offered on the cryptocurrencies it

Supported Naturally the highest interest rates Were only available to those who held Significant amounts of sell tokens and The highest interest rates were often Also paid in cell Besides high interest rates on Cryptocurrencies celsius was also known For the extremely low interest Stablecoin loans it offered interest Rates which could be reduced even Further granted you held enough sell Tokens If you’re wondering where celsius’s high Interest rates were coming from the Answer is lending Whenever you deposited your crypto into Celsius the company would do things like Lend your crypto to institutions deposit Your crypto into d5 protocols and even Use your crypto for staking and mining In other words celsius would do whatever It needed behind the scenes to ensure That the interest rates it was earning On its users assets were always enough To pay out the interest rates it was Promising to its users and celsius the Company would keep the difference if any Celsius would pay its users every monday And a portion of the interest earned by The platform would be used to buy back And burn the sell token causing its Price to rise as such you can think of Cell as being an exchange token like

Ftx’s ftt which has similar buyback and Burn dynamics You can learn more about exchange tokens And their pros and cons using the link In the description Anyways at its peak celsius held over 30 Billion dollars of cryptocurrency which Had been deposited by the more than 1.7 Million users earning an estimated 3 Million of interest per day on their Coins and tokens Now this insane statistic included Celsius ceo alex mazzinski who mentioned In many interviews that he had deposited 300 million dollars of his own money Into the platform Now it looks like celsius’s troubles Began in earnest last july when liquid Staking protocol stakehound lost access To the keys to its ethereum wallet Resulting in 74 million dollars of eth Being locked forever On-chain analysis by nansen suggests Most of this eth belonged to celsius More about liquid staking later One month later celsius announced that It surpassed 1 million users and 20 Billion dollars in assets under Management Now it’s safe to say that the platform’s Exponential growth and high interest Rates are what started to attract the Attention of regulators in the united States around this time

It didn’t help that alex was explicit in His mission to disrupt and eventually Replace the banks using celsius the same Way the voice over internet protocol Disrupted and eventually replaced many Telecommunications companies It also didn’t help that celsius had Reportedly received a 1 billion loan From usdt issuer tether which isn’t Exactly known for its transparency For context tether had invested 10 Million dollars in celsius in 2020 Though alex insisted at the time that Tether would have no influence over Celsius It seems that celsius’s willingness to Engage with regulators and its Aforementioned 750 million dollar raise Kept the guys in suits at bay for a few Months but the scrutiny returned last November when celsius cfo was arrested In connection with an alleged crypto Money laundering scheme in israel The bad press continued in december when D5 protocol badger dao was exploited for 120 million dollars 51 million of which Was in the form of wrapped btc believed To have belonged to celsius Now i’ll quickly note that celsius’s Ethereum wallets are public on its Website hence these on-chain analytics In january this year bloomberg reported That everyone’s favorite regulator which Is of course the securities and exchange

Commission was investigating celsius one Of its competitors voyager digital and Cryptocurrency exchange gemini over Their high interest rate offerings Whereas another celsius competitor Called blockfi was subsequently fined 100 million dollars by the sec celsius Is assumed to have struck a deal which Would see it avoid additional scrutiny If it limited its high interest rate Products to accredited investors i.e Rich people in the usa Anyhow around the time that celsius Restricted its high interest rate Products to these accredited investors In the united states the platform Started to see hundreds of millions of Dollars of outflows as retail investors Fled to greener pastures or cashed out Completely By that point the value of the crypto Custodied by celsius had collapsed along With the rest of the crypto market and The about us page of the celsius website States that the platform held just under 12 billion dollars of crypto in may Which appears to be the last time this Figure was updated As you can see the about us page also Notes that celsius had processed 8.2 Billion dollars in loans at the time Which presumably means that users had Borrowed 8.2 billion dollars worth of Stable coins from the platform using

Their crypto as collateral As it so happens celsius had been Aggressively promoting its loan products Since last autumn and had started Offering sub-zero interest rates on Stablecoin loans in may this year This is extremely significant because Just a few days later cnbc reported that Credit card debt in the united states as Well as the interest rates associated With said credit card debt were headed For all-time highs because of all the Economic stress associated with the de Facto recession we’re arguably in Now this makes me wonder whether celsius Started to see hundreds of thousands of New and existing users turn to its Platform to leverage its low interest Rate loans for debt relief There’s obviously no way of knowing for Sure but i reckon it’s possible if not Likely that the demand for celsius loans Was very high Now in addition to making loans more Accessible celsius was also investing Heavily in crypto mining having signed a Multi-million dollar deal with a data Center for its crypto mining operations And having poured 500 million dollars Into the mining itself Celsius even filed to take its own Crypto mining public in may this year in The hope that it would start trading on Stock exchanges and attract even more

Investment By this point it was becoming clear that Celsius was becoming desperate for Yields that had been reduced by crypto Market conditions As many of you will know another thing That happened in may was the collapse of Terror’s luna and its ust stablecoin Both of which had apparently been added To celsius just a couple of months prior Contrary to what the critics have Claimed there’s little to no evidence That celsius was directly affected by Terror’s collapse that’s because celsius Immediately cashed out when ust lost its Peg as per a follow-up interview with Ceo alex mizinski something later Confirmed by nansen’s on-chain analysis Now you can get the facts about what Happened to terror using the link in the Description Anywho this is where the facts start to Get a bit fuzzy so bear with me as i Break them down to the best of my Ability Although celsius wasn’t directly Affected by terrace collapse it didn’t Stop the critics from claiming that it Had been and many began to spread rumors That celsius was secretly insolvent Given the carnage in the crypto market Many celsius users fell for the fud and Celsius subsequently saw billions of Dollars of outflows

Keep in mind that all this happened back In mid-may Shortly afterwards alex said in a Twitter spaces discussion that quote Wall street sharks were trying to take Down celsius tether and make a dao after They had successfully destroyed terror And that quote they are all looking for Any weakness to short and destroy Now you might recall that alex was Explicit about his intention to replace Banks with celsius It should come as no surprise then that Alex had mentioned in many interviews That he had no shortage of enemies on Wall street and that this has been the Case since his telecommunications days In one interview alex said that he Doesn’t even get invited to high-profile Parties with other billionaires because Quote they hate me Now it should go without saying that These statements should be taken with a Grain of salt but for the benefit of the Doubt let’s assume it’s true In any case on the same day alex made His now famous wall street sharks Comment celsius released a road map for 2022 which included a crypto card more Stable coin loans lower fees crypto Staking that’s available to retail Investors and other stuff that likely Made celsius critics and competitors Seethe

The critics and competitors needed a new Source of fuel for their flood campaign And in the first week of june they got Just what they needed concerns around Ethereum’s transition from proof of work To proof of stake and the implications This could have on liquid staking tokens Like lido finances st eth If you watched our video about lido Finance you’ll know that st eth is a Sort of receipt that’s given to you when You stake eth on ethereum’s beacon chain Via the lido protocol This receipt more or less mirrors the Price of eth and it can be freely traded On exchanges while it earns staking Rewards in real time As you might have guessed st eth is Essentially the holy grail for platforms Like celsius and coin telegraph reported That some of them had converted as much As 80 Of their users eth into st In celsius’s case coindesk reported that 70 percent of its users eth had been Converted into st eth Now there’s only one small problem and That’s that converting eth into st eth Is a one-way trip for the time being It’s not possible to claim the staked Eath backing the st eath on the beacon Chain until the merge is complete and Even then it could be months before it’s Possible to unstake any staked

So what this means is that if you have St eth and want to get the actual eath Back you must go to a centralized or Decentralized exchange and sell your st Eth for eth If too many people do this at once then The cell pressure has the potential to Push st eth below its peg and that’s Exactly what happened When the news broke that ethereum’s Developers had delayed ethereum’s Difficulty bomb many individuals and Institutions began to sell off their st Eth this is because the difficulty bomb Is meant to incentivize miners to switch To proof of stake so the delay logically Meant the merge itself would be delayed The ste sell-off led many crypto Analysts to speculate that st east could Fall to as much as 50 percent below eth And those who had terrorist collapse Fresh in their memory fell for the fud That st eth could fall to zero even Though this is unlikely since st eth is Fundamentally backed by staked eth just With a bit of delay Because it was easy to see how exposed Celsius was to st eath thanks to its Transparency some believe that bad Actors took advantage of the chaos to Push st eth down as much as possible to Liquidate the hundreds of millions of Dollars of loans celsius had taken on d5 Protocols using st eth as collateral

Regardless over leveraged individuals And institutions like crypto hedge fund Three arrows capital began selling off Their st eth to meet their own debt Obligations and protect profits Crypto trading firm alameda research Alone drained 20 of st east liquidity With their massive sell-off according to Gate.io Now the whole ordeal spooked celsius Users enough to cause a real run on the Bank with everyone rushing to the Platform to withdraw their wreath Because st eth had lost its peg and so Much of it was locked up in d5 protocols It’s suspected that celsius couldn’t get The eth it needed to honor user Withdrawals As a result celsius paused all Withdrawals swaps and transfers on the 12th of june seemingly confirming that The critics and competitors were right This time around celsius had in fact Become functionally insolvent i.e it Didn’t have enough cash on hand to pay Out withdrawals Now it’s important to stress though that This is different from balance sheet Insolvent i.e not enough assets liquid Or otherwise to pay out liabilities Now no one really knows about celsius’s Balance sheet solvency but the headlines We’ve seen since then such as celsius Competitor nexo offering to buy them out

And celsius’s investors refusing to bail Them out are widely considered to be an Indirect confirmation of Insolvency all the while celsius has Been selling off hundreds of millions of Dollars of crypto causing many coins and Tokens to crash including cell and Urging its users to stay calm while they Wonder whether the collateral for their Loans has been liquidated and whether They’ll ever get their coins and tokens Back This brings me to the three big Questions at the forefront of everyone’s Minds and that’s whose Celsius’s current state is Whether celsius can recover and what This all means for the cell token I’ll start by saying that it’s quite Clear that celsius had spread themselves Very thin and i honestly think they were Completely blindsided by terra’s Collapse and the crypto market carnage That ensued I think this because celsius ceo alex Mazzinski was saying at the end of april That btc and eth would hit new all-time Highs in 2022 just a couple of weeks Before terra’s collapse Now while alex could have been just Saying this to make the headlines recall That he was literally putting his money Where his mouth is Not only that but alex mentioned in a

January interview that celsius was Looking to double its workforce of 800 a Workforce that had already grown by 3x Over the last year or so Comments alex made in other interviews Also suggest that the hiring process Wasn’t exactly thorough to put it mildly So what happens when you have a massive Company of one thousand plus people most Of whom are new Billions of dollars spread across Multiple d5 protocols exchanges and Mining operations billions of dollars of User loans and lots of crypto market Volatility Well you get a show and that’s what Celsius got However this doesn’t mean that nobody Took advantage of the situation to Capitalize on the chaos There seems to be some evidence that Some institutions were actively working To take celsius out when it was down and Most of this evidence comes from a Thread by a twitter user named plan c I’ll leave a link to the thread in the Description but the tldr is that Institutional investors were furious When celsius pulled out of luna and ust This is because celsius withdrawing 500 Million ust from terra’s anchor protocol Is believed to have been one of the Primary catalysts that led to terror’s Collapse

Now to be clear i’m not saying that Celsius caused terra’s collapse i’m Simply saying that celsius withdrawing Such a large amount of ust after it fell Below its peg due in part to market Manipulation by another entity on curve Finance Scared many ust holders into selling Which accelerated the de-pegging Now in their twitter thread about Celsius plan c provided screenshots that Strongly suggest institutional investors Were working on restoring ust’s peg by Pouring billions of dollars into ust Trading pairs something that was Actually confirmed to us here at coin Bureau by a terror insider the story Goes that celsius refused the calls to Help rescue terror and instead decided To cash out to protect their users Assets This in turn led to the run on anchor And the ust sell-off i just mentioned Which ultimately led to terror’s Collapse This left the institutional investors That were trying to restore ust’s peg With billions of dollars of losses As you might have guessed plan c’s Theory is that these institutions Decided to get back some of these Billions by liquidating celsius and Crashing and shorting its cell token Many seem to be pointing the finger at

Alameda research but alameda research Founder and ftx ceo sam bankman freed Claims that is bs because alameda and Ftx are committed to supporting crypto Companies like celsius even if they lose Money To that end alameda and ftx have Provided hundreds of millions of dollars Of loans to blockfi and voyager digital To make sure they stay solvent Now when it comes to whether celsius Will recover i reckon there’s a high Likelihood that celsius will survive in Some form be it under its own brand or The brand of a competitor like nexo A user base of 1.7 million is no small Feat in crypto and it’s something that Many companies would happily acquire One wild card is potential regulations Platforms like celsius are extremely Unpopular among regulators and celsius Owes much of its success to the fact That it was actively sticking its middle Finger in the face of the big banks who Actively lobby regulators like the sec Another wild card is whether the sell Token would survive the rebrand if any Now if celsius does get taken over i Find it unlikely that the sell token Would play a big part of that new setup But it’s really hard to say For now the only thing supporting sales Price seems to be a massive short Squeeze in short everyone buys sell

Price goes up shorts get liquidated etc Now the most important thing is that Celsius users get their coins and tokens Back and i believe this is something That is very much within the realms of Possibility As overstretched and over leveraged as Celsius was it seems to have the capital Required to compensate its users it’ll Just take some time If the worst comes to the absolute worst The silver lining is that we’re in a Crypto bear market and that means Celsius users will have lots of time to Accumulate the positions they’ve lost at Much lower prices if you’re one of them Know this so long as you’re healthy stay Optimistic and continue to work hard you Can recover from any financial loss and Then some believe me i’ve been there And that’s all for today’s video about Celsius’s supposed collapse if you found It insightful smash that like button to Give the algorithm some insight if you Want to make sure you don’t miss the Next video subscribe to the channel and Ping that notification bell if you can’t Wait for the next video to come out Check out coin bureau eclipse for more Vids and behind the scenes takes you can Also check out the coin bureau podcast For deep dives into crypto projects and Concepts I’m active on twitter tiktok and

Instagram and post daily crypto updates With lots of alpha on telegram If you’re wondering what cryptos i hold As part of my portfolio you can Subscribe to my weekly newsletter to Find out and get my exclusive take on Where that crypto market could be headed Next If you’re looking to stay cool while Looking crypto this summer head on over To the coin bureau merch store and get a Couple of articles of clothing yes we Accept crypto Now you can find your way to all these Resources and more using the links down Below thank you all so much for watching And i’ll see you in the next one this is Guy bidding you goodbye [Music]


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