Celsius Network, a cryptocurrency lending firm, said on Monday that it has decided to pause withdrawals and transfers between accounts due to “extreme market conditions“.
Extending earlier declines, Bitcoin fell more than 6% to as low as $24,888, an 18-month low after Celsius’s announcement. The world’s second-largest cryptocurrency, Ether, dropped more than 8% to $1,311, its lowest since March 2021.
In a blog post, the company wrote that they were taking that necessary action “in order to stabilize liquidity and operations while we take steps to preserve and protect assets”.
“Furthermore, customers will continue to accrue rewards during the pause in line with our commitment to our customers”, the blog post reads.
Celsius Network raised $750 million in funding late last year. The company is a significant player in crypto lending. It offers interest-bearing products to customers who deposit their cryptocurrencies with the company. Celsius Network also lends out cryptocurrencies to earn a return.
Particularly in the US, the sector has come under regulatory scrutiny.
Falling alongside other so-called risk assets as interest rates have risen around the world, crypto markets have been under pressure in recent months.
The main cause of price falls has been attributed to the collapse of some crypto projects, most notably the collapse of stablecoin TerraUSD.
Last month, TerraUSD last month broke its dollar peg and collapsed in value, rocking the crypto industry. read more
The meltdown in TerraUSD, one of the world’s largest stablecoins, sent shockwaves through cryptocurrency markets on Thursday, pushing another major stablecoin Tether below its dollar peg and sending bitcoin to 16-month lows.
Related Post: Why do people trust crypto despite being unregulated?
More about Crypto firm ‘Celsius’
Founded in 2017, Celsius network is a Blockchain-based marketplace platform where membership provides access to curated financial services that are not available through traditional financial institutions. Celsius specializes in the fields of consumer lending, fintech, and financial services. Raised $750 million in funding late last year, Celsius Network is a significant player in crypto lending.
Many in the cryptocurrency industry know Alex Mashinsky as the founder and CEO of Celsius Network, an all-in-one financial services platform that catapulted into market rankings in 2020.
Experts say the main reason behind pausing all transfers and withdrawals between accounts is the Price Decline in Bitcoin.