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Crypto Custodian, Prime Trust Ends Year-Long Relationship With Crypto Lender, Celsius
The crypto custodian, Prime Trust, is expected to stop providing services to the Celsius crypto earning app in the coming month. A source familiar with the matter said the mortgage on user assets was the main issue. Celsius also recently halted its services to UK residents.
Prime Trust, a crypto custodian, is ending its one-year relationship with crypto lender Celsius within the next 30 days. Prime Trust, however, picked up on the real reason for stopping offering Celsius child care in a statement released Thursday.
According to a spokesperson, Prime Trust has noticed suspicious red flags in the Celsius way of doing business and will start cutting Celsius users off its platform. After the 30-day notice period has passed, the Guardian will lock down all Celsius APIs, denying users access to their Guardian Platform.
The termination letter sent by Prime Trust claims that a “variety of business factors” caused the split – ending the successful one-year relationship between the two companies. The statement further reads,
“We won’t comment beyond that, other than wishing Celsius the best of luck in its endeavors.”
Sources familiar with the matter claim that Prime Trust terminated the Celsius partnership because of the latter “endlessly mortgaging users’ assets”, which is deemed dangerous for its business structure. Mortgage means that lenders, bankers and brokers use users’ assets deposited as collateral for their own gain. Prime Trust considers this trend as dangerous for its activity, hence the cut.
This is not the first time that Celsius has clung to its public image. In April, the crypto lender suffered a data breach that exposed its users’ data through a third-party mailing list.
Responding to the claims, a spokesperson for Celsius vehemently denied any mortgages by the lender. The spokesperson explained that they are leaving the partnership with Prime Trust because the services offered to New York customers are not on par with Celsius. The statement reads,
“Since Celsius started offering its services to New York residents, it has never re-mortgaged their crypto assets.”
“Unfortunately, the level of service provided to our New York users through our partnership with Prime Trust was not at the level Celsius users are used to, and therefore we plan to provide an alternative solution for our state users. from New York.”
Celsius leaves the UK
Celsius recently announced that it will be leaving the UK and withdrawing its application for temporary registration with the Financial Conduct Authority (FCA). The crypto lender said uncertainty in crypto regulations was the main reason for the exodus.
Celsius will focus its efforts in other countries – particularly the United States – “securing licenses and registrations in the country and in other jurisdictions that will ensure the long-term viability of Celsius and its community,” says his press release.
Lujan Odera
Lujan is a blockchain technology and cryptocurrency author and publisher. He has been working in cryptocurrency and blockchain technology since 2015, helping him gain enough experience to be the writer he is today. He is known for his straightforward writing style which allows novices to understand the field in the easiest way.
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