Celcius Accused Of “Ponzi Scam” After Halting Withdrawals And Transfers

Due to “extreme market conditions,” crypto lending company Celsius Networks LLC halted all withdrawals, swaps, and transfers between accounts on Sunday.

“We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations,” the New Jersey-based company said in a statement.

“Acting in the interest of our community is our top priority. In service of that commitment and to adhere to our risk management framework, we have activated a clause in our Terms of Use that will allow for this process to take place. Celsius has valuable assets and we are working diligently to meet our obligations.”

Celsius is one of the world’s largest crypto loan organisations, with over $20 billion in assets at one point.

However, it has run afoul of regulators, and some users have recently accused Celsius of causing them to lose money by encouraging them to use its CEL digital tokens as collateral for loans — CEL fell 48 percent late Sunday, and has lost more than 75 percent of its value in the last month, and 97 percent in the last year, according to CoinGecko data.

The cryptocurrency industry as a whole has taken a beating this year, with the whole crypto market down more than 40% in the last two months.

Bitcoin BTCUSD, for example, hit an 18-month low on Sunday and has lost 45 percent of its value this year; it’s down more than 60% from its all-time high in November.

The statement comes after one of the most volatile weekends in cryptocurrency history, with hundreds of millions of dollars in liquidation.

Bitcoin and Ethereum were trading at around $25,585 and $1,346, respectively, at their lowest values in over a year at the time of publication.