Friday, February 23, 2024

State Securities Regulators Target Celsius Over Withdrawal Freeze

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Several state securities regulators target Celsius over the withdrawal freeze that happened last week which led to regulators opening investigations into the platform’s decision so let’s read more today in our latest cryptocurrency news today.

The state securities regulators set their sights on the crypto lending company Celsius Network over the decision to suspend customer withdrawals over the past week. The Texas State Securities Board director of enforcement, Joseph Rotunda, said that the offices in Alabama, Kentucky, Texas, New Jersey, and Washington are making it their priority to investigate the lender. Rotunda said:

“I am very concerned that clients—including many retail investors—may need to immediately access their assets yet are unable to withdraw from their accounts. The inability to access their investment may result in significant financial consequences.”

Rotunda said the state regulators will begin their investigation into Celsius whch froze the client accounts on Sunday in a liquidity crisis. Celsius told its 1.7 million customers that it will pause withdrawals, swaps, and transfers between accounts due to extreme market conditions. The post read:

“We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations.”

After the announcement, Celsius’ native token CEL dropped 70% in one hour from $0.49 to $0.15. at the moment, the CEL token is the 148th biggest crypto by market cap and it is now trading at $0.53. The Celsius CEO Alex Mashinsky broke his silence on social media and said that the company is focused on the customers’ concerns and was quite thankful to have heard from so many:

“To see you come together is a clear sign our community is the strongest in the world. This is a difficult moment; your patience and support mean the world to us.”

While Mashinsky put on an optimistic tone on social media, Celsius started hiring restructuring attorneys from the law company Akin Gump Strauss Hauer & Feld LLP for guidance.

As recently reported, The troubled crypto lending platform Celsius Network is not getting bailed out according to reports that we are reading today. The Major Canadian pension fund Caisse de depot et placement du Quebec and New York-based WestCap Group previously led the oversubscribed $750 million Series B funding round for Celsius last year which helped the company reach a valuation of $3.5 billion.

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