Crypto Lender Celsius Pauses Withdrawals, Transfers Citing 'Extreme Market Conditions' (techcrunch.com) 111
Celsius Network, one of the biggest crypto lenders, told customers Sunday evening that it is pausing withdrawals, swap, and transfers between accounts in a move that has sparked discussions and prompted the price of the firm's token to take a 60% tumble in the past one hour to as low as 19 cents. From a report: "We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations," wrote Celsius, which counts stablecoin-issuer Tether International, growth equity fund WestCap Group and Canadian pension fund Caisse de Depot et Placement du Quebec among its investors. [...] Celsius, which was valued at $3.25 billion when it extended its "oversubscribed" Series B financing round to $750 million in November, allows users to deposit their Bitcoin, Ethereum and Tether and receive weekly interest payments. Depending on the time horizon and the token, the platform offers as much as 18% interest a year. On its website, Celsius says 1.7 million people call "Celsius their home for crypto."
badah dump dump dump (Score:5, Funny)
another one bites the dust...
Re:badah dump dump dump (Score:5, Funny)
I thought you were doing the McDonald's jingle there.
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I thought you were doing the McDonald's jingle there.
To be fair, the ice cream machine would be making those sounds, if it were actually working...
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Re:badah dump dump dump (Score:4, Insightful)
Avoid negative returns (Score:5, Funny)
Celsius could have avoided negative returns by converting to Kelvin. Absolutely.
Re: Avoid negative returns (Score:2)
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Not Hobbes? Who is this Dobbs?
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The good news (Score:5, Insightful)
Well, at least it's decentralized, right guys?
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Don't worry, folks will be along shortly with a 'no true scotsman' argument about how yet another cryptocurrency based institution isn't 'true' crypto and therefore somehow shouldn't count in any evaluation about the reality of good old anarcho-capitalist style cryptocurrency.
Re:The good news (Score:4, Informative)
To be fair, it is decentralized if you always keep your holdings in your own wallet and don't keep anything on an exchange.
That being said, doing so is a pain in the ass and not nearly as convenient as just keeping it on the exchange. Until the exchange goes *pop* and takes all of your shit with them.
You know, just like pre-FDIC banks.
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Question, because I truly don't know this stuff. If you have your wallet with all your information in it, and the exchange goes bust, can you take your wallet to a different exchange and still get access to your stuff?
Re:The good news (Score:4, Informative)
Your wallet is your wallet. You don't 'take your wallet to an exchange'.
If you sign up for an exchange, you basically transfer things from your wallet to theirs, so it's no longer in your wallet.
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The point of the exchange is it increases the liquidity of your cryptocurrency holdings in certain useful ways. The downside of the exchange is your holdings are effectively owned by the exchange -- you gave it to them to hold in your name. That is also a kind of "increased liquidity" -- you can suddenly lose all.
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Many investors that entrust their crypto to exchanges experience considerable increases in liquidity...in their pants.
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It's not just that. The people who can't get their "money" now are possibly smart(ish) in that they recognize a working financial system requires the ability to issue credit. They're dumb because they've managed to overlook the fact that the whole creating your own currency thing has been tried many times in the past and ended with pretty predictable results.
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It does have the distinction to be the first decentralized "banking" crash. So at least it should make history. That and $5 will get you a coffee at Starbucks.
Meanwhile... (Score:2)
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We don't. We love 3rd world countries, that's why we all hope bitcoin will disappear before another 3rd world country has a retarded leader pull an El Salvador style scam fucking over its citizens.
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dont hate yourself.
appreciate what you have and work within its limits. theres structure to the universe for good reasons.
you have walls in your home for good reason. you were born yesterday,, thats why you want to undue everything because you dont have the emotional stability to work within the framework.
make sure you stop working like a slave buying donuts all day and put your big boy pants on and good your
I'll say it (Score:1)
This is good for Bitcoin.
Your Bitcoins are numbers and your NTFs are JPEGs (Score:5, Insightful)
Deal with reality.
Re:Your Bitcoins are numbers and your NTFs are JPE (Score:5, Insightful)
Your NFTs aren't even JPGs; they're links to JPGs.
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Almost all of them aren't even links to JPGs, they're just numbers that some people associate with a link to a JPG. Neither the link, nor the JPG is inherent to the number, unless very specifically stated as such (like in the Bored Ape club).
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So much this. When you listen to crypto maxis and they invariable make an argument to the tune of "with NFTs, you actually OWN the asset and it cannot be taken away from you". And they just gloss over the fact that the entire infrastructure (website, database, CDN, hosting, etc.) is just as vulnerable as if you had bought it from a "web 2.0" site.
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You sound like every day trader and speculator that has lost their ass in a market bubble. "It's always gone up before, why wouldn't it go up again?" Answer: because people smarter than you are getting the fuck out and taking their money to more reliable returns due to external market conditions they see and you don't.
The people who "drive far better cars" - whatever that's supposed to indicate - do so because they know when to get out and make decisions based on aggregating information together to get a
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I would differ with your opinion, though. Most people follow the trend, whatever the trend is. Smart money often resists the trend and goes against the tide--but only if they believe in the fundamentals of the action.
Re: Your Bitcoins are numbers and your NTFs are JP (Score:2)
If you mined it six years ago, surely youâ(TM)re still up along way. Why not cash in now while youâ(TM)re guaranteed something?
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but people who drive far better cars than you do are in this industry
I guarantee you these people have not have nor will ever have their better car as long as I've had my shitty one. My industry has a few rich people as well. And that's really the thing isn't it "survivor bias". For every one person driving a Ferrari in the Cyrpto world there are a million who have lost considerable amounts of their savings.
The big difference between my industry (you can insert any normal industry here, no need to be specific), the rich people in it are likely to stay rich and their grand ch
It's a Wonderful Life! (Score:5, Insightful)
A run on the "bank". How quaint!
Re:It's a Wonderful Life! (Score:4, Insightful)
It is ironic how much cryptocurrency stuff mirrors unregulated banking from the 1900s-1920s era. Even more interesting is how tough it is to get out of a cryptocurrency should a run happen. Everything from gas or transaction prices going up exponentially to the trading network not being able to process the requests unless one pays for higher priority, to just only a certain number of transactions max being able to be done per unit time.
Easy in, and if one quietly is dumping, easy out. However, when the music stops, kiss your investment good bye.
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It's just the same thing, but electronic. If you were involved in a bank run in the 1920s you could stand in line with the peasants (limited transaction rate) or you could bribe somebody to let you skip it ("gas" fees).
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It's not ironic at all. The whole point of cryptocurrency is to avoid regulation, so it should be no surprise that it has recreated the problems of an unregulated financial system. This was 100% a predictable- and predicted- outcome. The only reason people are surprised is because they didn't listen to the warnings.
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The 1900s-1920s was at least mildly regulated. It's more analogous to the "wildcat banking" era from 1830s-1860s when banks printed their own currencies redeemable in some other assets.
The era was known for regular scams as well as bank runs.
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Even more ironic. Take the hated company scrip, call it a cryptocurrency, and everyone and their brother wants it.
I still don't get the "x" currency wrapped with "y" stuff.
The fall is always quick (Score:3)
Binance too, for "technical reasons" :/
Pyramid schemes take a long time to build up but, generally, unravel relatively fast. The difference with crypto is that, rather than a single party that benefits, this has a lot of interested players with a lot to lose. So, there may be a concerted effort to prop it up. But I suspect that the end result will be all the same.
Re: The fall is always quick (Score:2)
All of the finance-like terminology they adopted really brought in the suckers.
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Binance too, for "technical reasons" :/
Such a surprise...
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...this has a lot of interested players with a lot to lose. So, there may be a concerted effort to prop it up. But I suspect that the end result will be all the same.
I'm sorry are we still talking about crypto here? Because this sounds exactly like the US Stock Market.
The "difference" here. That's fucking cute.
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US stock market (or any stock market for that matter) trades in securities of actual companies. We may disagree on the value of these companies to society and the world, but they do, for the most part, exist. There is nothing at all behind the "crypto".
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Except crypto can go all the way to zero and there's no Crypto HQ or Cryptoland or Crypto Studios to sell. Cryptocurrencies, unlike companies listed on the NYSE, don't have any real assets or products or anything else that makes them worthwhile.
A better comparison would be the currency of a third-world country, That seems quite apt.
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Not just Celsius (Score:2)
Bitfinex have suspended crypto withdrawals. Binance has stopped people taking their Bitcoin out because of a 'stuck transaction'.
Can't let the proles cash in their crypto while the whales unload their bags.
Re: Not just Celsius (Score:2)
*citation needed
A Pension Fund?! (Score:5, Insightful)
Re: A Pension Fund?! (Score:1)
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And it's a massive, massive pension fund with several little VC offshoots.
You say that, as if a pension fund called "Blackrock", would make everyone magically feel better.
That "massive, massive" excuse, is the reason people now worry about massive amounts of corruption.
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All pension funds have an "Extremely High Risk" wallet, and I imagine this 'investment' was one of those.
If not, then yes, heads need to roll...
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It's Quebec. Their public pension funds can't get any more screwed up, so why not?
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Well, they are the ones getting the pensions so seems fair.
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I guess you're American? The organization in question was set up to manage Quebec's public pension fund. The one all taxpayers pay into, and the one that pays their (public) pension when they retire.
You're maybe thinking of pensions for public servants. I think the CDPQ also manages those, but that's not where most of their money comes from.
Crypto needs banking laws to cover it (Score:2)
Crypto needs banking laws to cover it
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Well, yes. But that also happens to remove all advantages. And you do not really believe any of those "exchanges" can qualify for a banking license?
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Some have tried, they basically got laughed out of the room.
And yes, the whole 'crypto' business is just like 'banking' back in the 1800's.
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Some have tried, they basically got laughed out of the room.
Having a bit of an idea what getting a banking licence actually involves, that is the expected result.
And yes, the whole 'crypto' business is just like 'banking' back in the 1800's.
Indeed. There are no really new scams. Just old ones adapted to the current times.
Bank run on the internet (Score:5, Insightful)
People old enough to remember what is a bank run would probably be less susceptible to these crypto scams.
To those too young to have seen what a bank run looks like, this is it. Don't you love Deregulated Finance? You can get to experience all the banking scams in the past two hundred years in internet time!
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A run on the bank is when people decide (for whatever reason) that a bank is failing, and they rush to get their money out before it fails. Since the bank does not have enough reserves to cover everyone, people are unable to get their money. This leaves the bank insolvent and the depositors do, in fact, lose their deposits. Stopping bank runs is a major purpose of the FDIC - because deposits are insured people do not have to worry about the bank failing. Even if it does, their deposits are protected.
Just the beginning (Score:3)
Not that I'm a huge fan of regulation, but you're going to see a lot of these "fly by night" beneficiaries of the crypto ponzi ecosystem vanish into the woodwork as the prices of these "currencies" implode.
Here's a bird's eye view of what happens in this ecosystem:
https://www.comparitech.com/cr... [comparitech.com]
You'll see the shenanigans accelerate as people get (more) desperate.
I See Nothing Wrong With This If ... (Score:2)
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It stopped being your 'money' the moment you transferred your numbers to the wallet of the exchange.
And since there's no lawfully protected or covered definition of the value of any crypto coin, good luck trying to get your 'money' back in court.
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If it is not in the contract then a Class Action is the next logical step.
A class action will do nothing. In a bankruptcy, your assets were loaned to them as unsecured credit - the lowest rung on the debt recovery ladder. They didn't offer you any collateral - just the promise that the money is still yours. In bankruptcy, all of the creditors who gave them secured credit will get their money back first. Lawsuit or not, there won't be enough left to cover the people who transferred their money into Celsius.
One month ago... (Score:4, Insightful)
... Coinbase warned that people might loose *all* of their money invested in "crypto" using their service. But hey, this will not really happen, right?
You had a 1-month warning, now this. It is full, completely full of red flags everywhere.
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The biggest read flag is the behavior of the customers though.
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When they made that announcement, the little crypto I have was moved to a hardware wallet to "protect" the small amount of ETH that I've mined to dick around with crypto (it's only protected from exchange theft, still at risk to general collapse). Anyone who left their money sitting on someone else's system with no expectation of guarantee or insurance is just a dumbass when they're literally warning you that it's really their money if you leave it there.
Burn the only thing you have (Score:2)
Crypto currencies are valued entirely by trust, largely a trust that your funds go up in value and you can trade them as you want. By pausing trading they just burnt the only trust they had. You can do that only if you are backed by a central bank to hold your value stable.
Companies are people. We need to discuss offering mental health services to these suicidal companies. :-)
Trustless. Permissionless. (Score:1)
People who fail to understand Satoshi will always be easy prey. It's fraud - don't expect too many people to get in the way of prosecution.
Not your keys, not your crypto. If you can't keep 20 words safe and available, DON'T get into investment or smart contracts, for Pete's sake. Buy bullion or coins - that's easy for everybody.
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Cryptocurrencies had promise, but the above info is not really communicated to people who want to dabble in that market. People often want to "buy Bitcoin", so they wind up buying from an exchange with a custodial wallet... then are subject to the exchange's whims of what they can do with the currency, or even lose everything all together if the exchange's master key gets swiped.
It is a minefield out there. Even factoring out how gas and transaction fees can go up exponentially if there is a run, users ne
It's A Crypto Bank Run (Score:1)
Re:It's A Crypto Bank Run (Score:5, Informative)
The short-term to long-term arbitrage can be done profitably even by small banks. I used to own investment real estate in rural Ohio and had talked to local bankers. 10-year variable-rate mortgages were held on the bank's balance sheet. They had about a 2% gross margin between the mortgage rate and their deposit rate. They knew that, in the worst case, they could take a squeeze to 1% by offering higher deposit rates and there was little concern about a run thanks to FDIC insurance
Thirty year fixed was too risky. They would originate for local buyers but the mortgages were all sold to government agencies.
Who are they lending to who is paying more than 18% interest? And why would depositors not realize that a "bank" paying 18% interest (and presumably charging 20%+ interest) obviously has clientele that aren't very credit worthy! I guess the same people who put their IRAs in crypto and brag about getting 18% on their money tax free. SMH
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My guess is they are dead and are just trying to delay the inevitable. Maybe they just want to rob themselves before the inevitable collapse and run.
Well, what do you except from fraudulent, no oversight, no regulation, no insurance and no reserves "banking"? The safety net in regular banking is there because all of these scams have been done before.
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18% interest in a year? Are people utterly stupid? (Score:2)
Don't answer that, I know they are. This is a completely reliable sign of a scam: Interest rates you could normally not get anywhere.
1929 (Score:2)
It's like 1929 but with extra steps. Literally. :-/
My Tulips !!!!!! (Score:2)
Give me my tulips....
In other words, they are almost bankrupt. (Score:2)
AKA (Score:2)
"Pausing Withdrawals"
aka "We lost our shirt so we're keeping your money"
A pension fund?! (Score:2)
Still, I would've thought Canada would be smarter, they usually are.
1.7 mill people call it their home (Score:1)
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1.7 mill people are going to be homeless - quick buy shares in shopping carts - there is going to be a run on them.
And here I thought camping supplies would be the hot ticket, as REI becomes the next Stop in this Game.
I wish I could do the same... (Score:2)
I wish I could just decide to stop issuing payments to my creditors, and suffer no adverse consequences whatsoever.
Maybe they should have invested in crocodile dollars instead. If even the government having complete control of currency is problematic, how much worse is having no control at all? [youtu.be]
Place your bets (Score:2)
Is Vegas giving odds on all crypto going to zero? Do you? I'd say there is a 60% chance that the crypto show vanishes before the end of the year.
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Oh wait, holding crypto is betting on it. That explains so much...
Re: Place your bets (Score:2)
But how do you bet against it?
Gotta post this again... (Score:1)
Instead, you have tons of exchanges controlling it? And, who governs or controls the exchanges?
How is this better than a fiat currency governed by a central bank? Why should I feel more secure when the governance of my money in controlled by some anonymous, greedy, SillyCon Valley opportunist?
Re:The grand master plan of crypto (Score:5, Informative)
the banks got a bailout because the toxic mortgage securities had spread to so many financial institutions that it could put them into insolvency, which would then affect the bank accounts of every single American. TARP was in fact a method to make sure the banks had liquidity to protect the average American from the banks failing. Also, if you look at the actual hard results of TARP (I'm not taking the extenuating effects of TARP on the economy to prop it up, as that is debatable), the government ultimately netted about a $66B written off loss in TARP, but of course following that had an impressive growth economy for over 10 years. But that's besides the point.
Crypto on the other hand has none of the political backing the banks had. It has very little chance of spreading through the financial system to hit the average American's bank account. There is really no incentive for the government to bail them out, so I see no reason why they wouldn't just let those guys crash and burn.
Re:Sorry, crypto is too big to fail (Score:4, Insightful)
I disagree, part of the whole advocacy of crypto was toward the end of wanting to supersede the USD with something else. There would be an inclination to let those that tossed their lot in with such a motivation. If the strategy was to go outside the USD system, then the USD system bailing them out wouldn't make much sense. In short, they would probably want to penalize behaviors that undermine them, rather than reward them so they'll use those rewards to turn around and try again somehow.
In terms that you proved energy was used in the establishment of a particular unit of currency, that is not intrinsic value. The limited supply does not confer intrinsic value, it's just simply an abstract fact that is given value only if people want to give it value.
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crypto actually holds intrinsic value
It does not because that energy put into mining it is gone, cannot be traded back out for equivalent energy in return unless I happen to trade it back out for USD and buy new energy with it, which just makes the whole affair kindof pointless? Crypto is not a store of energy like grain or oil or a car or cattle. The energy put into it is only worth something via speculation.
El Salvador's GDP is $25B so right away that's $21B less than Musk is planning to buy Twitter for and $36B less than what Broadcom is
Re: Sorry, crypto is too big to fail (Score:2)
Crypto has operated as a bailout from the beginning. The original revolution, which crypto became an instrument of, was targeted at the federal reserve and oriented toward the idea of something more like a gold backed currency. With excessive money printing, crypto operates like a like a monetary reservoir which can be filled over one period hiding inflation, an emptied over another causing mass inflation, and transferring wealth to crypto investors who didnt produce anything. It is evil, but the same inves
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Re: Sorry, crypto is too big to fail (Score:2)
Unstable currency is what every American is seeing right now via inflation. A fixed supply currency cant inflate, it can only deflate in times of growth, which arenâ(TM)t going to happen for awhile.
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It's hard to believe that enough institutions were stupid enough to invest so much in crypto that its collapse would cause a contagion. With the 2008 meltdown, the collapse had been predicted by those following the money for years.
One money manager told me that crypto became an acceptable commodity for money managers to use as part of their 15% allocation to commodities. It's hard to imagine that any one fund contributed more than a small fraction of this 15% allocation to crypto. So, we don't have trillion
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It's just more evidence that the wealthy financial types are not somehow smarter, they just happened to be born on 3rd base.
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However, if you look at where profits