Bitcoin at lowest since 2020, Celsius platform freezes withdrawals

by Tom Wilson, Alun John and Abinaya V

LONDON, June 13 (Reuters) – Cryptocurrency lending platform Celsius Network announced a freeze on withdrawals due to “extreme March conditions”, a move that helped escalate those same tensions and sent the price plummeting on Monday. bitcoin to its lowest level in almost 18 months.

Celsius Network promises high interest rates to clients who deposit their cryptocurrency with it and lend cryptocurrency from other “crypto” market companies or exchange investors in exchange for commissions. The company raised in November 750 million dollars (716 million euros) from investors including the second Canadian pension fund.

On her blog, she explained that she froze withdrawals and transfers between accounts “in order to stabilize liquidity and operations while we take measures to preserve and protect assets”.

“We work with one priority: to protect and preserve assets to meet our obligations to customers,” she added.

Cryptocurrency lending has seen steady growth, which has caught the attention of financial regulators, particularly in the United States. In mid-May, Celsius Network posted $8.2 billion in loans and $11.8 billion in assets according to its website.

At the same time, the crypto-asset markets have been going through a new zone of severe turbulence for several months now, linked to the disengagement of many investors from assets considered the most risky in the context of high inflation and the rapid rise in interest rates, a trend that also affect stocks.

The fall of the stablecoin terraUSD last month amplified this trend.

Bitcoin, the best known of cryptoassets, accentuated its decline after the announcement of Celsius and 09:25 GMT, it lost 16.77% 24,295.36 dollars, the lowest since December 2020. Ether, gave up 13.78% at the same time 1,235.47 dollars, its lowest level since January 2021.

The Celsius Network website still posted ads on Monday promising yields of up to 18.6%. “Earn high, borrow low, change the world”, assured its slogan.

On Twitter, rival platform Nexo said it offered Celsius help but tried to refuse, specifying a potential asset takeover job offer.

Celsius chief executive Alex Mashinsky did not immediately respond to a request for comment.

(Report Tom Wilson London, Abinaya Vijayaraghavan Bangalore and Alun John Hong Kong, French version Marc Angrand)

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