Celsius faces a balance sheet hole of 1.2 billion USD, customers owed USD 4.7 billion
Celsius faces a balance sheet hole of 1.2 billion USD, customers owed USD 4.7 billion
- Celsius has liabilities of $ 5.5 billion and assets of $ 4.3 billion, as one file from Thursday shows
- It has 23,000 loans to private customers of $ 411 million
A new submission of Celsius explains why it is unable to fulfill obligations and shows that the liabilities of the cryptocurrency loan exceed his assets.
On July 13th, according to A Made by CEO alex Mashinsky in the Thursday submitted file. This remains a shortage of $ 1.2 billion.
The lender owes its users over $ 4.7 billion, which means that he cannot repay them unless he finds liquidity of third parties.
The file submitted to the insolvency court for the southern district of New York on Thursday shows that Celsius granted two loans of $ 75 million to the competitive crypto hedge fund Three Arrows Capital (3AC). When 3AC could not repay the loan, Celsius liquidated the pledged collateral of 3AC and now has a claim of $ 40.6 million compared to the fund, said Mashinsky.
A little-known crypto trade company owes $ 81 million on the Kaiman Islands, the Pharos USD find. The filing lists an email to admin@lanternvures.com for the fund, which signals that it could be a subsidiary or a company that is connected to a crypto dealer based in London lanternen-ventures . Until the editorial deadline, Blockworks received no response from the email address regarding his loan. Celsius owes Alameda Research $ 12.8 million.
Some of Celsius' cryptoassets are bound in illiquid investments such as the Bitcoin mining business and a custody technology company, it said in the submission and added that due to these illiquid assets and the break-in of crypto prices, it was unable to fulfill user withdrawals and offer additional security
The lending of cryptocurrencies has gained popularity in recent years and has gained traction because they promise high returns on customer deposits and easy access to loans. This is about gaining profits from the loan of user deposits to institutional investors.
But after the recent crash of Terrausd (VAT) and the macroeconomic uncertainty, which put on the investigation, many lenders froze customer funds after they had a strong increase in the withdrawals. Celsius's own withdrawal stop on June 12 triggered fears from the users whether they could receive funds that were blocked on the platform.
his terms of use particularly increase these concerns.
In the submission of Thursday, Mashinsky said that the usage agreement between Celsius and his customer expressly stipulates that the users are obliged to transfer "all rights and titles" of their cryptoassets to the distributor, including the right to sell, lend and transfer them over any period of time.
The lender had 23,000 outstanding loans to private customers of $ 411 million with a market value of $ 765.5 million of digital assets, added the submission. It is currently in discussions with third parties about the procurement of potential new liquidity sources.
Celsius registered bankruptcy in New York this week, about a month after it had set the withdrawals on his platform for the first time.
Mashinsky also said that the company had tried to overcome the market descent-which he described as "cryptop coalysis"-and "false information" on social media on their connection with the collapse of terrausd for the decline of the CEL token.
The CEL of Celsius has so far dropped by 83 % this year - but rose by 5.4 % in the last month - and was traded at $ 0.73 on Friday at 1:00 a.m. href = "https://www.blockworksresearch.com/assets/cel/"> Blockworks-forschung indicates. The company claims that it now has around $ 600 million in CEL with a market capitalization of around $ 170.3 million (as of July 12).
A day before Celsius initiated the bankruptcy proceedings, the financial supervisory authorities in Vermont said that the company was "deeply insolvent" and could not meet his creditors.
But Celsius' bankruptcy could only be good news for the industry, as "it is an important step to enable the market to get away from the collapse of the credit market," said Jay Fraser, Head of Strategy at BStx.
The contribution "Celsius Faces Heat for $ 1.2b Balance Sheet Hole, Customers Debed $ 4.7b" is not a financial advice.