Crypto bank Celsius Network (CEL) is facing financial difficulties. A bailout doesn’t seem to be happening anymore, which is why there are now investors looking to take over assets from Celsius. The most notable side in line? That is presumably Goldman Sachs.
Goldman is Celsius’ auctioneer
That writes CoinDesk, who writes that he has spoken with people with knowledge of the case. Celsius is went bankrupt as crypto markets continued to decline. Like most banks, Celsius used some of its customers’ deposits to use for its own investments. Over thereit can pay high dividends† But at an ordinary bank these deposits consist of the virtually ‘risk-free’ cash, at Celsius it was about cryptocurrencies.
Na de problems, the company sought a bailout from investors, but they were not exactly happy on the granting of loans and the like. Now it doesn’t seem to be a bailout, but a bail-in† This means that Celsius’ assets are sold to interested parties far below the regular selling price. In this way, the board of Celsius prevents it from running out of money at all.
The large American investment bank Goldman Sachs leads this group of interested parties. The company does not appear to be buying investments from Celsius itself. Instead, it uses its network to take over $2 billion in assets from investors. It would be Web 3 crypto funds, funds around distress investing and other companies with enough cash.
Chain reaction for crypto on the way?
The crypto bank has consultancy firm Alvarez & Marshal hired, reports The Wall Street Journal. However, it remains unclear if and when customers of the Celsius platform will see some of their money back.
Celsius is just one example of what the market can expect. Yesterday we wrote about ‘slow levers† Celsius was a perfect example of this. It will take some time before the effect of this is clear, so the market could fall much further if it becomes clear that the problems are bigger than expected. The presence of Goldman Sachs at this sale does indicate that crypto is now really taken seriously on Wall Street.
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