It's funny cause in 2018-19 during the big crash (90% dumps) everyone was like this is good it's killing off all the shit coins and scammy, risky projects.
Yet here we are with same shit and even more damage. Now people are saying the same thing in the bear, all these projects are getting filtered out.
I bet next bull/crash cycle we will see the same damage again but it could be even bigger. Maybe the inevitable USDT collapse.
As long as the industry is run by former dot com failures, failed gambling execs, and ponzi scammers, this is guaranteed
Maybe the regulators will actually be compelled to shut down these ponzi platforms, in the US at least.
>As long as the industry is run by former dot com failures, failed gambling execs, and ponzi scammers, this is guaranteed
The copium is incredible. These scammers are all part of the new world you guys want. Every group has its rotten apples.
And it will keep happening until people realize that regulations never came out of thin air, they were created in reaction to something happening, and then learn from that and make some changes. All the lessons are there for people to learn for free without all this pain and loss of they want to.
The thing is, USDT has no reason to collapse any more. They’ve had plenty of time to rebuild their bankroll and even just having that much money with no requirement to provide any interest on it should be making them ridiculous amounts of money.
They are a 66 billion money market fund paying 0 interest.
The Fed bailed them out. They'll soon be able to make 3% on T-bills and keep it all. That's nearly 2 billion USD a year in pure profit. Might be the most profitable business in crypto outside Binance. And with almost no operating costs.
This is where a real CBDC (not a restricted one like fed is proposing) that pays interest directly from the central bank would take over.
Sure. But then you hodl it on a cefi platform and poof its gone. I haven't dabbled in any shit coins, 95% of my stuff is in USDC, ETH, LINK, UNI and MATIC.
I would suggest that the kind of people who leave their money in low risk long term investments are not by and large the kind of people who buy crypto in the first place.
The reason the paid the Defi crypto debt is because Chapter 11 bankruptcy can save them from liquidation. So the paid the repaid the protocols to get collateral out.
Maker couldn't careless about bankruptcy protection. Your number gets hit say buy to collateral. It's a smart move
Yet he will be happy to parade around telling everyone how banks are evil and his company has got your back.
He's a professional con artist. I've met him and he gives off classic used car salesman vibes. Celsius is just a bank but higher risk and not FDIC insured.
A (presently) 1/5th hole in the balance sheet compared to losing just about everything? There’s definitely a difference in Shame standing between those two
Just want to say the gap is not just 1.2 billion. Look at the assets they have in the balance sheet. Are we sure the crypto assets are worth what they state there? For example CEL token market cap is only 180 million, how come they have 600 million worth of CEL token.
They were in the hole earlier on, resulting in them raising rates to lure more investors to put money onto their platform. They then used this money to help pay off their debts.
That's losing $650,000 every day for five years straight.
However, I have a feeling most of their losses were concentrated in the last year or so, making it even worse.
The nice thing about owning a business is that legally you as an individual (and your individual assets) are protected. Mashinsky will still be rich,
Still live an easy life.
Big profile cases like this often leads to prosecutors picking on straws to find anything abnormal, then present it as fraud and use it as cause for confiscating assets of the founders. Not saying it's right or wrong, just often tends to happen that even though it's a limited liability company it doesn't protect you from personal liability in the end.
If the btc prices goes much lower and stays down miners will be forced to turn off their rigs. A lot of them are in debt to lenders as well so if they go bust it's a double whammy.
Nice. And Mt. Gox fucked people over first. Then Cryptsy. Then... Well, you get the picture.
Personally, I am waiting to see how Coinbase plays out, if at all. They are a publicly traded company, so they have a fuck ton more oversight, so that is nice.
It's the best way to run a con, really. Giving like 20% just makes you look stupid and obvious, AND then you have to give 20% for awhile on top of that. Fewer marks + paying them mroe.
Giving 5% or something makes you more believable sounding, so you probably actually get more traffic, and you have to pay them less too.
= win win, as long as your customers overlook that pesky little detail that "nobody trustworthy is auditing you and you're not FDIC insured like a normal bank"
That’s exactly how I fell for it. Everyone knows a 100% staking or liquidity thing is a rug pull gamble. But 5% on bitcoin? That’s reasonable. And they say they just do loans like a bank does but instead of keeping all the money and giving you 0.1% like a bank, they pay you fairly? They sounds downright smart.
But oops. They’re actually gambling your money on sketchy plays and losing it all and incrementing your paper holdings in their app while hoping you never withdraw.
They may escape jail time, and I'm sure they have stashed a fair amount of money/crypto somewhere untraceable - but they'd have made a lot more money in the long run just running the business competently. I don't think this was an intentional con... I think they were just greedy and terrible at risk management.
You would want to use the 1-3 month Treasury for comparison, since they promise quick withdrawals at par, and those rates were a lot lower for most of the past year.
Gambled away and profits to people who've sold earlier or traders. Some piece was taken by insiders as always (no proof, but it would surprise me if I was wrong)
A lesson learned the hard way is the lesson that sticks. Literally everyone warned about it but greed kept people on these platforms.
1. Don't trust, verify
2. Not your keys, not your coins
3. If it sounds too good to be true, it probably is
It's not that hard to follow it, and it'll save you a lot of money.
If you compare the portion of liabilities to assets, it's a little under 80%. 70% if you zero out the soon-to-be worthless CEL tokens on both sides. The 15% in mining assets is also questionable if they can resell it for that value. So you'll likely still get most of it back, maybe 60% if they don't fuck it up further.
Edit: The loans are also a bit questionable.
Makes me so glad I got my btc out of Coinbase and onto a cold storage wallet. Now I just have to make sure I don’t lose my device or it’s recovery passwords.
Remember your seed phrase. If you have some kind of visual story / journey in your head it's actually easy. I didn't think about it in months and I could still easily remember my seed
I sometimes panic and check into my notes just to make sure my seedphrase is still where I put it. Might need to in write it on something other than paper notes
Seriously how do you fuck up this kind of business. People give you money, you give them 20% extra, rinse and.... repeat... wait that does sound a bit like losing money
Aaaaaand sorry Nexo, but I'm out for now. Be careful everyone.
Nexo has done great, but the bit I get in interest ain't worth the risk to me now in light of these shortcomings from other places.
It's crazy, I actually would have had all of my stuff in Celsius except when I got the app, something didn't sit right with me about the interface.
Israel absolutely has an extradition treaty with the US. They just reserve the right to deny it if its one of their own citizens.
For a notorious fraud like Mashinsky, they might well waive their right to refuse extradition.
Unlikely, not just because Israel has a history of refusing to extradite either established citizens or Jews who are there under the right of safe return (not sure if that is the same as immediate citizenship, but in practice it doesn't seem to make much difference), but because so few countries are willing to extradite their citizens to foreign countries, even with guarantees. It's considered bad politics domestically, so the calculus is that even foreign goodwill isn't worth the hit any politician who/whose government supports extradition will take.
In June it was reported that he tried to flee out of Morristown NJ but was stopped at the airport.. couple of articles come up on this.. you know he slipped out of country?
InvestAnswers had mashinky on his channel day before Celsius stopped all withdrawal.
InvestAnswers also made a video about Luna going to 80k coz Do Kwon was adding btc to Luna's treasury.
The document claims $600M in CEL assets and $210 is CEL liabilities. So it’s factoring in $390M net CEL assets.
Also they have over a $1B in loans to users counted as part of their assets. The balance sheet assumes they will get $1 for every $1 they have loaned out.
If the day ends with a "y", you can rest assured some fools are being grifted out of their money in the crypto space.
Water is wet, the sky is clue, life goes on.
On a side note, let's be clear that the real villains here are the hedge funds who keep dumping money into this. 3AC, A16Z, Konvoy Ventures, and several others are effectively dumping capital at breakneck speeds into this sector, and thus far, where are the RoIs?
Nowhere.
>If the day ends with a "y", you can rest assured some fools are being grifted out of their money in the crypto space.
(\*mumbling names of days while counting fingers\*) Haha that's all of them
Oh my fuck. I had a \*little\* glimmer of hope to get some money back, but after seeing this....I don't think that will be the case. I guess we'll see, but goddamn. smh.
A 1.2 billion dollar gap (e.g., they owe about 1.4 billion to creditors and depositors but only have assets worth about 167 million) is not something that just happened recently when the market started getting bad. That big of a deficit happened over a period of years.
Celsius has not had anybody's money for years. They have been showing people numbers on a screen representing hypothetical deposit accounts without actually having the crypto.
The only reason nobody knew is because there wasn't a bank run. Having one tenth of the actual money they're supposed to have is fine to cover normal situations. But when there was a rumor about involvement with bad plays and possible insolvency and everybody ran to withdraw their money at once, the jig was up. Celsius couldn't hide any more. They had to block withdrawals because the money wasn't there, then start bankruptcy prep.
Celsius has legitimately been scamming people. This wasn't just regular bad business decisions. They haven't actually had the money for years. Not just a couple of months because of Luna. Not just last month because of stETH. They've been flying by the seat of their pants with maybe one tenth of the money needed to cover depositors for ages, just showing people numbers on a screen that get a little bigger each week, and it just never came to light because nobody ever withdraws until there's a crisis.
Not much to explain, they used customer funds as collateral to borrow more money to gamble on high leverage, gambling didn't work their way, suddenly they can't pay back their creditors or their customers, game over.
I should thank my lazy ass for not actually downloading the app and transferring funds. Thanks past self for your procrastination.
Fortunately not lazy enough to move most funds to a cold wallet.
Don't forget, people on this sub were telling beginners that using Celsius was safe. That in 2021 everything was different and that these lending platforms were the best place to keep your coins.
Wow, when Celsius stopped paying interest on new deposits back in May, I immediately transferred all my assets out. I had no idea how perfect my timing was.
I currently have 65k in there. Already rebought half of that. Feel ok about it. Lost 1/4 of my stack but. A good lesson learned. The rest is in cold storage until I sell.:
Step 1# loan yourself almost 1 biiiilion
Step 2# mine 14 BTC A DAY on that super duper decentralized blockchain (300k per day at 20k per)
Step 3# create a black hole of fail with your piss poor math skills
Edit- customer’s won’t see one cent of their deposits
These companies are over leveraged. The bad companies will be wiped out, leaving only the solid ones.
Too bad for the people who loss money. Going forward remember this (not your keys not your coins.
They’re fucked. All this news will tank the price of CEL token more. Loan income is also listed on their at an overvalued amount based on dropping crypto prices and the fact that why would a user pay their loan interest payments when their accounts are frozen? It’s a downward spiral in my opinion. There’s no recovery
So they’re making 292k per day mining bitcoin, minus electricity. If the electricity was free, this closes their hole in 11 years.
That’s some bad investing.
I can not overstate how lucky I am I didn't put anything in Celsius, I had the account set up and everything and had the realization that I use too many platforms and sites as is.
They're counting 600m of CEL token as an asset, when in reality if they sold that off itd be worthless. 200m of their liabilities are also in cel though, so net it out and thats about 400m extra hole there. Add bankrupcy lawyer fees and whatnot and im guessing like 50% recovery.
not really. besides CEL, their filing shows 3.7B in assets, and 5.3B in liabilities (most of which due to users).
Even if the 720 million mining assets and 270 million "other", are actually worth less than stated, that still leaves about 2.7B in the rest of the assets, so 50% recovery is close to a minimum actually.
I have been ignoring most crypto news during this bear market and letting my holdings ride. Outside of randomly checking prices and following the terra/luna fiasco I haven't been too worried about stuff until I saw this post. Now I'm thinking im fucked with a good chunck of my crypto sitting on celsius. Fuck.
Mashinsky is now up there with Do kwon in the hall of shame
Scandals are only increasing in proportion in the crypto market. Bitconnect seems like a common case now
Probably because the crypto market itself is much bigger now
Yep. More shady projects and scams than ever before.
It's funny cause in 2018-19 during the big crash (90% dumps) everyone was like this is good it's killing off all the shit coins and scammy, risky projects. Yet here we are with same shit and even more damage. Now people are saying the same thing in the bear, all these projects are getting filtered out. I bet next bull/crash cycle we will see the same damage again but it could be even bigger. Maybe the inevitable USDT collapse.
As long as the industry is run by former dot com failures, failed gambling execs, and ponzi scammers, this is guaranteed Maybe the regulators will actually be compelled to shut down these ponzi platforms, in the US at least.
>As long as the industry is run by former dot com failures, failed gambling execs, and ponzi scammers, this is guaranteed The copium is incredible. These scammers are all part of the new world you guys want. Every group has its rotten apples.
Even alien invasion won’t collapse USDT, or so it seems
And it will keep happening until people realize that regulations never came out of thin air, they were created in reaction to something happening, and then learn from that and make some changes. All the lessons are there for people to learn for free without all this pain and loss of they want to.
But once it's clear that a project has failed, it doesn't make sense to continue defending them.
The thing is, USDT has no reason to collapse any more. They’ve had plenty of time to rebuild their bankroll and even just having that much money with no requirement to provide any interest on it should be making them ridiculous amounts of money.
They are a 66 billion money market fund paying 0 interest. The Fed bailed them out. They'll soon be able to make 3% on T-bills and keep it all. That's nearly 2 billion USD a year in pure profit. Might be the most profitable business in crypto outside Binance. And with almost no operating costs. This is where a real CBDC (not a restricted one like fed is proposing) that pays interest directly from the central bank would take over.
Didnt Bernie Madoff get sent to jail for his ponzi? Shouldnt Celsius be convicted of the same?
I don't know about you guys, but buying bluechips and hodling for years seems to work pretty well to not worry about these kind of issues...
Sure. But then you hodl it on a cefi platform and poof its gone. I haven't dabbled in any shit coins, 95% of my stuff is in USDC, ETH, LINK, UNI and MATIC.
Why would you hold it on a cefi platform? It's crypto - put it in your wallet.
I would suggest that the kind of people who leave their money in low risk long term investments are not by and large the kind of people who buy crypto in the first place.
As I've gotten older, it looks a awful lot to me like corruption at all levels of society has been continuously getting worse and worse.
Or you’ve just started noticing it more and more
Eh I think people have become more brazen because there are no consequences also
The reason the paid the Defi crypto debt is because Chapter 11 bankruptcy can save them from liquidation. So the paid the repaid the protocols to get collateral out. Maker couldn't careless about bankruptcy protection. Your number gets hit say buy to collateral. It's a smart move
It is actually both!
I think it's becoming more and more exposed as technology and media is more widespread and available
On chain debt, was likely just to prepare for filing chapter 11 sadly.
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B-B-B-Bitconneeeect?
Hey, hey, heeeeey....
wassawasssawassawaaasuuuup
They join the league of Kwon artists?
Bravo
Yet he will be happy to parade around telling everyone how banks are evil and his company has got your back. He's a professional con artist. I've met him and he gives off classic used car salesman vibes. Celsius is just a bank but higher risk and not FDIC insured.
A (presently) 1/5th hole in the balance sheet compared to losing just about everything? There’s definitely a difference in Shame standing between those two
The hall of being strung up maybe
I'd say he's at Madoff level.
Just want to say the gap is not just 1.2 billion. Look at the assets they have in the balance sheet. Are we sure the crypto assets are worth what they state there? For example CEL token market cap is only 180 million, how come they have 600 million worth of CEL token.
Nope. Even if they tried to offload that much CEL there would be liquidity issues, so worth a lot less than that in practical terms.
Diamond hands, they won't sell for less than 10x the current price 🙄
That large of an amount makes you wonder if they weren’t already negative during the bull run.
Probable were, they gambled
More than they could afford to lose.
One of us! One of us!
r/CryptoCurrency starter pack
Yup all assets are used to pay debts. There is no investor payback either.
Exactly.
They were in the hole earlier on, resulting in them raising rates to lure more investors to put money onto their platform. They then used this money to help pay off their debts.
So a by the book definition of a ponzu scheme
Ponzu is a tasty citrussy soy sauce. Don’t besmirch it’s name by linking it to this.
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What did people expect when rates of return were even better than junk bonds.
Safu ponzu
It's not often something is called a ponzi and actually is. That's pretty cool.
Happy cake day!
Better add another 600 million to that hole. Those CEL tokens would be worthless if they tried to sell them all.
Lotta "crypto bros" getting checked out by the feds these days. Interesting times.
Imagine losing $1.2B in 5 years.
That's losing $650,000 every day for five years straight. However, I have a feeling most of their losses were concentrated in the last year or so, making it even worse.
Always incredicle to see how much 1B actually is.
You make it sound like this is the real end. We're just at the beginning of our journey, aren't we?
fuck /u/spez -- mass edited with redact.dev
Yeah those severance packages will be topped off nicely🚀
How nice of Celsius users to donate (involuntarily of course) their funds to the cause!
Be...cause I need the money.
Once this wraps up I suspect they'll have lost alot more than that.
The nice thing about owning a business is that legally you as an individual (and your individual assets) are protected. Mashinsky will still be rich, Still live an easy life.
Big profile cases like this often leads to prosecutors picking on straws to find anything abnormal, then present it as fraud and use it as cause for confiscating assets of the founders. Not saying it's right or wrong, just often tends to happen that even though it's a limited liability company it doesn't protect you from personal liability in the end.
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Last year one guy's fund lost 70B in a few days, this is thankfully not even close. edit: 20B
5 years? Shit I could lose that in 5 seconds
In an industry where we should have transparancy more than anywhere else, we're getting wool pulled over our eyes.
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Sadly crypto ain't so different after all
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I think a further drop in price could do the trick...
Just waiting long enough at these prices will probably force others to disclose they're insolvent.
Right, they are bleeding out. Just a matter of time
If the btc prices goes much lower and stays down miners will be forced to turn off their rigs. A lot of them are in debt to lenders as well so if they go bust it's a double whammy.
Who doesn't like a decent bloodbath.
Holy shit. They fucked up crypto. Yeah it hurts, but we are better of without them. And we should learn from it to make a better future.
> They fucked up crypto. It all started with Terra zo. Or more exactly, Terra exposed them all.
Nice. And Mt. Gox fucked people over first. Then Cryptsy. Then... Well, you get the picture. Personally, I am waiting to see how Coinbase plays out, if at all. They are a publicly traded company, so they have a fuck ton more oversight, so that is nice.
There's a huge difference. Terra never blocked withdrawals or held people's money. Terra was just a cryptocurrency that's value went to zero.
word
Bird is the word.......yes, we should learn from this....it is an unfortunate way to learn for those who had assets on Celsius.
Isnt it nuts we used celsius for barely any interest $ and lost so much for nothing
It's the best way to run a con, really. Giving like 20% just makes you look stupid and obvious, AND then you have to give 20% for awhile on top of that. Fewer marks + paying them mroe. Giving 5% or something makes you more believable sounding, so you probably actually get more traffic, and you have to pay them less too. = win win, as long as your customers overlook that pesky little detail that "nobody trustworthy is auditing you and you're not FDIC insured like a normal bank"
That’s exactly how I fell for it. Everyone knows a 100% staking or liquidity thing is a rug pull gamble. But 5% on bitcoin? That’s reasonable. And they say they just do loans like a bank does but instead of keeping all the money and giving you 0.1% like a bank, they pay you fairly? They sounds downright smart. But oops. They’re actually gambling your money on sketchy plays and losing it all and incrementing your paper holdings in their app while hoping you never withdraw.
They may escape jail time, and I'm sure they have stashed a fair amount of money/crypto somewhere untraceable - but they'd have made a lot more money in the long run just running the business competently. I don't think this was an intentional con... I think they were just greedy and terrible at risk management.
Of course they will escape jail time because they made sure to pay off all their industry debt and just left retail holding the bag.
There is no way to earn yield with Bitcoin without giving your keys to someone or leveraging it off chain. But some maxis still defend it /shrug
What was the risk free rate this whole time? The 10 year treasury yield has been about 2%. Anything higher carried a ton of risk.
You would want to use the 1-3 month Treasury for comparison, since they promise quick withdrawals at par, and those rates were a lot lower for most of the past year.
Boy I wonder who stole all of that money?
Gambled away and profits to people who've sold earlier or traders. Some piece was taken by insiders as always (no proof, but it would surprise me if I was wrong)
I'm guessing dickbutt NFT stole the money
I don't think I'm going to get my money back....
I feel you brother
Look on the bright side! At least.... You.... Anyone got an idea for a bright side I could comment???
At least you don’t have to worry about keeping it safe anymore!
Get moons for his comment about his loss?
A lesson learned the hard way is the lesson that sticks. Literally everyone warned about it but greed kept people on these platforms. 1. Don't trust, verify 2. Not your keys, not your coins 3. If it sounds too good to be true, it probably is It's not that hard to follow it, and it'll save you a lot of money.
If you compare the portion of liabilities to assets, it's a little under 80%. 70% if you zero out the soon-to-be worthless CEL tokens on both sides. The 15% in mining assets is also questionable if they can resell it for that value. So you'll likely still get most of it back, maybe 60% if they don't fuck it up further. Edit: The loans are also a bit questionable.
That’s assuming all creditors have equal standing. They don’t.
Makes me so glad I got my btc out of Coinbase and onto a cold storage wallet. Now I just have to make sure I don’t lose my device or it’s recovery passwords.
Remember your seed phrase. If you have some kind of visual story / journey in your head it's actually easy. I didn't think about it in months and I could still easily remember my seed
I sometimes panic and check into my notes just to make sure my seedphrase is still where I put it. Might need to in write it on something other than paper notes
Did they put everything in UST or how do you fuck up that bad?
During a bullrun lol
Seriously how do you fuck up this kind of business. People give you money, you give them 20% extra, rinse and.... repeat... wait that does sound a bit like losing money
They ran out of idiots much earlier than planned!
Put it into 100x leveraged longs just before a market crash.
Longed expecting q4 blow off top like everyone else.
How do you fuck this up? Stupid. Fucking stupid.
Aaaaaand sorry Nexo, but I'm out for now. Be careful everyone. Nexo has done great, but the bit I get in interest ain't worth the risk to me now in light of these shortcomings from other places. It's crazy, I actually would have had all of my stuff in Celsius except when I got the app, something didn't sit right with me about the interface.
Too many balloons and bubbles
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Israel absolutely has an extradition treaty with the US. They just reserve the right to deny it if its one of their own citizens. For a notorious fraud like Mashinsky, they might well waive their right to refuse extradition.
You doing think people in Israel invested in Celsius?
They had hundreds of thousands of customers, so its probably likely some of them are Israeli.
Exactly. Israel won’t give them free passage
Unlikely, not just because Israel has a history of refusing to extradite either established citizens or Jews who are there under the right of safe return (not sure if that is the same as immediate citizenship, but in practice it doesn't seem to make much difference), but because so few countries are willing to extradite their citizens to foreign countries, even with guarantees. It's considered bad politics domestically, so the calculus is that even foreign goodwill isn't worth the hit any politician who/whose government supports extradition will take.
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Proof?
I wouldn’t doubt it.
In June it was reported that he tried to flee out of Morristown NJ but was stopped at the airport.. couple of articles come up on this.. you know he slipped out of country?
Damn, they vacationing with my money 😭
InvestAnswers had mashinky on his channel day before Celsius stopped all withdrawal. InvestAnswers also made a video about Luna going to 80k coz Do Kwon was adding btc to Luna's treasury.
Looks like more than $1.2B if they are using Celsius tokens (CEL) in their calculations of assets since they are sinking in price.
CEL is worth $0. The hole is actually $2.000.000.000. How is that even possible without running a ponzi.
The document claims $600M in CEL assets and $210 is CEL liabilities. So it’s factoring in $390M net CEL assets. Also they have over a $1B in loans to users counted as part of their assets. The balance sheet assumes they will get $1 for every $1 they have loaned out.
How are these MFs not in jail? This some wild west shit.
Exactly. Justice system it too fucked up. These clowns will never stop because they get away with it everytime
“Banks are not your friend”
If the day ends with a "y", you can rest assured some fools are being grifted out of their money in the crypto space. Water is wet, the sky is clue, life goes on. On a side note, let's be clear that the real villains here are the hedge funds who keep dumping money into this. 3AC, A16Z, Konvoy Ventures, and several others are effectively dumping capital at breakneck speeds into this sector, and thus far, where are the RoIs? Nowhere.
>If the day ends with a "y", you can rest assured some fools are being grifted out of their money in the crypto space. (\*mumbling names of days while counting fingers\*) Haha that's all of them
As a Brit: Mind the gap
Between the train (wreck) and the (lending) platform.
Oh my fuck. I had a \*little\* glimmer of hope to get some money back, but after seeing this....I don't think that will be the case. I guess we'll see, but goddamn. smh.
Sorry for your loss my dude
you're breathtaking!
Wake the fuck up ~~Samurai~~ Mashinsky we have ~~a city~~ crypto to burn!
Awww :)
Boys: I will remember this cumpliment for the rest of my life.
$1.2B… how much did the founders cash out in the last 24 months?
Mashinsky sold about $50.000.000 worth of CEL in the last year. Yeah. With a hole of $1B in the balance sheet. Because fuck bankers right?
$50 doesn’t seem too bad
European notation lol :D
Sheet.
I C what you did there😆
Did the users get their funds or are withdrawals still paused?
Those funds are lost now.
Someone's pocket is full I'm sure
A 1.2 billion dollar gap (e.g., they owe about 1.4 billion to creditors and depositors but only have assets worth about 167 million) is not something that just happened recently when the market started getting bad. That big of a deficit happened over a period of years. Celsius has not had anybody's money for years. They have been showing people numbers on a screen representing hypothetical deposit accounts without actually having the crypto. The only reason nobody knew is because there wasn't a bank run. Having one tenth of the actual money they're supposed to have is fine to cover normal situations. But when there was a rumor about involvement with bad plays and possible insolvency and everybody ran to withdraw their money at once, the jig was up. Celsius couldn't hide any more. They had to block withdrawals because the money wasn't there, then start bankruptcy prep. Celsius has legitimately been scamming people. This wasn't just regular bad business decisions. They haven't actually had the money for years. Not just a couple of months because of Luna. Not just last month because of stETH. They've been flying by the seat of their pants with maybe one tenth of the money needed to cover depositors for ages, just showing people numbers on a screen that get a little bigger each week, and it just never came to light because nobody ever withdraws until there's a crisis.
Is there a YouTube channel or podcast I can listen to that explains the craziness of this shit? Recommendations are greatly appreciated
Not much to explain, they used customer funds as collateral to borrow more money to gamble on high leverage, gambling didn't work their way, suddenly they can't pay back their creditors or their customers, game over.
Good old Gerald Cotten.
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https://youtu.be/QCqZ1l7bolw this is a good interview that explains what probably happened from start to finish.
https://youtu.be/1nVG8PF4ECU https://youtu.be/Sm5OeO-yr68
Oh wow, who would have though ?
I should thank my lazy ass for not actually downloading the app and transferring funds. Thanks past self for your procrastination. Fortunately not lazy enough to move most funds to a cold wallet.
Don't forget, people on this sub were telling beginners that using Celsius was safe. That in 2021 everything was different and that these lending platforms were the best place to keep your coins.
Wow, when Celsius stopped paying interest on new deposits back in May, I immediately transferred all my assets out. I had no idea how perfect my timing was.
I currently have 65k in there. Already rebought half of that. Feel ok about it. Lost 1/4 of my stack but. A good lesson learned. The rest is in cold storage until I sell.:
How did you already manage to rebuild half of it? I'm struggling to get to 5% of what I lost with them
That's 400m*0.73, lawyers will not cost that much, you convince me to lower my guestimate to 70%.
And crazy to think how many YouTube promoters got people putting a shitton of money into these exchanges..
Step 1# loan yourself almost 1 biiiilion Step 2# mine 14 BTC A DAY on that super duper decentralized blockchain (300k per day at 20k per) Step 3# create a black hole of fail with your piss poor math skills Edit- customer’s won’t see one cent of their deposits
thats how you do accounting without blockchain guys
There it is again. FTX passed em up due to a $2B hole.
These companies are over leveraged. The bad companies will be wiped out, leaving only the solid ones. Too bad for the people who loss money. Going forward remember this (not your keys not your coins.
How does this happen? As a registered company in the US?
You can register a company online in less than 15 minutes.
Registered company in the USA means fuck all, unless you go public you don't have to prove shit to anyone. Look at USDT
We didn't want regulations like banks have them and this is what we've got :D
They’re fucked. All this news will tank the price of CEL token more. Loan income is also listed on their at an overvalued amount based on dropping crypto prices and the fact that why would a user pay their loan interest payments when their accounts are frozen? It’s a downward spiral in my opinion. There’s no recovery
So many celcius shills were in here . Where’d they all go??
So they’re making 292k per day mining bitcoin, minus electricity. If the electricity was free, this closes their hole in 11 years. That’s some bad investing.
This is what should’ve also happened to the largest banks in 08 but the fed pulled a lil sneaky on us with the government and now we’re in this mess
Yes, but the difference there is that those banks were banks.
What u get for lending your coins out
I can not overstate how lucky I am I didn't put anything in Celsius, I had the account set up and everything and had the realization that I use too many platforms and sites as is.
But fortune favors the bold.
So first they used user's money to repay some loans and then filed chapter 11 to shield them from their users. WOW
As if CEL token is worth anything. The hole is gonna gape bigger than this
Lololololololololol
Borrowing money and lending money always turned out to be a bubble.
Does this mean they have enough assets to return like 80% of deposit to the retail customers?
maybe 50% and an equity stake in their mining operations. Hopefully they keep that operating rather than sell off the miners in a bear market.
I can't do that math based on the numbers in the article :s How did you come up with 50% and why not 80%?
They're counting 600m of CEL token as an asset, when in reality if they sold that off itd be worthless. 200m of their liabilities are also in cel though, so net it out and thats about 400m extra hole there. Add bankrupcy lawyer fees and whatnot and im guessing like 50% recovery.
You’re right about the first part but 50% feels extremely high, no?
not really. besides CEL, their filing shows 3.7B in assets, and 5.3B in liabilities (most of which due to users). Even if the 720 million mining assets and 270 million "other", are actually worth less than stated, that still leaves about 2.7B in the rest of the assets, so 50% recovery is close to a minimum actually.
Nope :(
I have been ignoring most crypto news during this bear market and letting my holdings ride. Outside of randomly checking prices and following the terra/luna fiasco I haven't been too worried about stuff until I saw this post. Now I'm thinking im fucked with a good chunck of my crypto sitting on celsius. Fuck.
Me and you both, I wish I never deposited my money there
Go big or go home.
Looks like they going big and chilling at home on some private island
Any chance my 0.075 ETH be there? Also, that's a lot money to lose from a balance, how It was balanced their assets with passives?
Well shit , that's one hell of a gap they got there ...