Celsius has taken action to address its financial situation by initiating the sale of its altcoin assets. With the approval of a US judge overseeing the bankruptcy case, the company has converted these altcoins into Bitcoin (BTC) and Ethereum (ETH).
During this challenging period, Celsius refrained from making any on-chain movements regarding its assets. However, this changed last Wednesday when it decided to withdraw over $60 million worth of tokens from cold storage using the services of Fireblocks.
These assets were subsequently transferred to FalconX, an intermediary platform that facilitated their onward transfer to the well-known cryptocurrency exchange, Binance.
Source: Blockworks
Starting this morning, Celsius has been actively transferring cryptocurrency funds to FalconX, an institutional exchange. Blockworks has reported that these transfers’ cumulative value has reached $63.3 million.
Celsius Liquidations, Potential Impact On Crypto Prices
Analysts have raised concerns that Celsius’ ongoing liquidations could harm cryptocurrency prices, particularly for the assets included in the fire sale.
Among Celsius’ altcoin holdings, Chainlink (LINK) is speculated to face the highest selling pressure compared to other assets being offloaded. However, at the time of reporting, LINK is currently trading at $7.14 on Coingecko, exhibiting a 6.6% increase over the past 24 hours.
Interestingly, other coins in Celsius’ remaining crypto portfolio have experienced positive price movements. Tokens such as COMP, SUSHI, and 1INCH have seen gains.
However, not all assets have fared as well, as BNT, KNC, AAVE, SNX, and MATIC are all trading in the red, reflecting a decline in their respective prices.
In July 2022, the company found itself in a dire financial situation, prompting the company to seek bankruptcy protection. The decision was made in response to a shortfall in customer funds, which temporarily suspended withdrawals for some time. This development dealt a significant blow to Celsius and its operations.
Adding to the already complex circumstances, the US Department of Justice (DOJ) recently made headlines with the arrest of Celsius’s former CEO, Alex Mashinsky.
As of today, cryptocurrencies have a total market cap of $1.16 trillion. Chart: TradingView.com
Bloomberg revealed last week that Mashinsky is facing multiple charges, including securities fraud, commodities fraud, and wire fraud. The arrest of the former CEO further compounds the challenges faced by the company as legal proceedings and investigations unfold.
The combination of the bankruptcy filing and the arrest of Mashinsky has cast a shadow of uncertainty over Celsius and its future. These events have undoubtedly created a complex and intricate situation for the company.
The implications of these developments on Celsius’s stakeholders and the wider cryptocurrency community remain to be seen.
Featured image from Coinmama