What is Celsius?
Celsius is a platform that allows users to earn interest on deposited cryptos and take out loans. Celsius describes itself as follows:
Celsius is proud to provide a platform of curated services that have been abandoned by big banks – things like fair yield, zero fees, and lightning quick transactions. Our goal is to disrupt the financial industry, one happy user at a time, and introduce financial freedom through crypto.
So Celsius is something like a bank without being a bank.
Why were people so excited about Celsius?
Celsius has paid out very high returns for staking stable coins, for example, Celsius promises an APY of more than 7% for USDT!
Since stablecoins have a stable value, or at least should have (looking at you UST), it seemed to be risk-free profit.
The latest chapter to Celsius' history
In a blog post from Monday, Celsius announced that withdraws and transfers will be paused effective immediately.
Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, Swap, and transfers between accounts.
This has triggered fears among users about the solvency of the platform and many are also trying to sell the CEL token issued by Celsius. Meanwhile, CEL has lost more than 96% of its ATH value.
What now?
In times like these, it's only understandable that people are afraid of the collapse of yet another platform. After the recent collapse of the supposed stablecoin UST, no platform seems "too big to fail". It is therefore advisable to invest only what you can lose. Nobody knows whether Celsius will still exist tomorrow.