Celsius price prediction: Will investors warm to CEL again?

• Updated

Flash crashes have panicked investors in the already lagging crypto market, so what’s next for CEL?

The Celsius logo on a phone                                 
Celsius takes a 20% cut of the profit on all interest payments – Photo: Shutterstock
                                

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Celsius Network is a P2P lending platform allowing users to borrow and lend cryptocurrencies. 

After another market-wide crypto crash in mid-June 2022, Celsius has been forced to temporarily suspend withdrawals and transfers, citing “extreme market conditions”. As a result, investors and commentators have speculated that the centralised finance (CeFi) lender was running out of funds. This is not an unprecedented situation in crypto: Terra Luna illustrated the very real possibility of a financial collapse back in May. The Crypto Fear and Greed Index has dipped into “extreme fear” and the total crypto market capitalisation has dropped below $1trn, indicating strong bearish sentiment. 

Bitcoin has plummetted to $20,134.30 at the time of writing, a new 18-month low, and an unfortunate example of how events can snowball and cause the broader digital asset market to suffer. CEL, the native token of the Celsius Network sank to a two-year low of $0.1554 on 13 June but is currently trading up from that price point at $0.9449. 

Despite current events, is a brighter future in store for the Celsius token, and can we make a Celsius price prediction?

What is Celsius (CEL)?

In 2017, the Israeli-American entrepreneurs Alex Mashinsky and Daniel Leon declared themselves unhappy with the direction of traditional finance and wanted to bring the priorities of fair interest, zero fees and fast transactions back to the consumer. Their self-described goal was to disrupt the finance industry and make it much more accessible.

Celsius offers a wide range of banking features. Users can take out loans, earn interest and buy digital assets. The platform is mainly gaining users through attractive interest rates. But there is a catch: Celsius takes a 20% cut of the profit margins on the interest payments. 

The founders of the crypto banking platform have experience in this area. Mashinsky has a history in the internet development sphere along with seven start-ups to his name. Leon also has start-up experience and had previously focused on growing early-stage businesses.

CEL is the ERC-20 token behind Celsius. It can be used to generate rewards, provide discounts on loans and gain higher interest rates. The more tokens an investor holds, the greater these rewards are. Can it continue to attract more investors?

In January 2022, CelsiusX was launched as the DeFi arm of the Celsius ecosystem, and the platform aims to prioritise interoperability between blockchains and tokens. Celsius seeks to bring higher rates of return and accessible loans to the masses, under the slogan: “The wallet that pays you back”. 

Since CelsiusX’s launch in 2018, CEL climbed to an all-time high of $8.02 in June 2021. Since trading at that price, the coin has largely been on a downtrend. CEL has shown some brief signs of recovery, but crypto crashes and controversy have caused the coin to sink to record lows. 

Celsius’s past performance

CEL’s initial coin offering took place in March 2018. The price was $0.03 and the token stayed at that level for the first few months of its trading. It was in April 2019 that the coin started rallying.

Version 3.0 of the Celsius app launched that month, driving CEL to around the $0.08 mark. It managed to push further the following month, passing $200m in community-held assets as more users joined the platform. CEL hit a peak of $0.11 on 16 May 2019.

The token started falling after June, dropping back to around $0.03 in November. Its next breakout began at the end of December and continued into the first few months of 2020. The Celsius network put this down to “rising community sentiment”. By 12 February 2020, CEL had reached $0.17.

Celsius saw an even more substantial rally that started in September that year. This correlated with an increase in activity on the platform. The last week of September saw rewards worth more than $1m being given to users in just seven days. This occurred again in late October, which fuelled CEL’s price to pass $1 for the first time.

This breakout continued into the following month as Chainalysis revealed Celsius was the second-largest digital asset manager, with $3.3bn in community-held assets. This news was subsequently reported on Bloomberg’s TV channel. On 23 November 2020, CEL hit a price of $2.56.

Celsius managed to keep up the momentum and the platform continued growing. In January 2021, it was revealed that 125,000 new users had joined the platform in the previous three months. Celsius also reached $5.3bn worth of community-held assets. CEL rocketed in the first week of the new year, reaching $6.48 on 3 January 2021.

For most of the following months, the price of CEL stayed around the $5 mark. It surged even further in April after a new website app was announced, and Celsius ambassadors were given the chance to try it out. CEL broke its price record on 8 April 2021 after hitting $7.73.

June 2021 was an even more active month for the platform and token. On 3 June, Celsius revealed its platform was holding more than 100,000 BTC owned by its community. The same day, CEL hit its all-time high of $8.02.

Although the token dropped slightly, the platform kept the momentum going. It announced the following day that it was investing $200m in a North American-based Bitcoin mining operation.

A volatile period for CEL

Over the next few months, CEL ran hot and cold. It plummeted to $5 at the end of June 2021 before almost reaching $7 in July. Then it dropped back to $5 at the end of August.

The price continued to fall in September 2021, dropping below the $5 mark. It temporarily came close to $6 in October after the Sushiswap cryptocurrency was listed on the platform. Celsius had also lowered the necessary amount for a stablecoin loan to $100.

But CEL resumed its bearish trend throughout the following months. By mid-November it had fallen under $4. It again temporarily saw a boost on 30 December, as the platform was announced as the best CeFi lending platform at Blockchain Fest 2021.

Like most cryptocurrencies at the beginning of 2022, CEL was on a downward trend. The Ethereum-based token had dropped to a new 14-month low of $2.01 on 24 January 2022. The token’s main focus seems to be interoperability. The company revealed in a blog post that it was partnering with blockchains such as Polygon and wrapping cryptocurrencies, including DOGE. 

On 22 February, the CelsiusX platform launched a DeFi version of Celsius, and the coin was trading sideways around the $3.30 price point until April. 

On 15 April 2022, Celsius accounted that only “accredited” United States-based investors would be able to add new assets and earn rewards on the Celsius Earn platform. According to the specification, in order to be accredited in the US, investors must have a “minimum annual income of $200,000, or a net worth over $1m.”

Celsius feels the heat

As a lending platform that utilises stablecoins, including UST, Celsius felt the impact from the collapse of the Terra ecosystem. In a Twitter Spaces talk, Mashinsky revealed that the “Sharks of Wall Street” were causing instability in several crypto projects, not just Terra. 

This was after a Celsius user said at the talk that their account was recently liquidated after the decline of CEL’s price. Mashinky responded and said someone was after the company. “This is not a coincidence. This is somebody who decided, ‘You know what? I’m going to take down all of Celsius.’” 

Another market slump followed, and Celsius Network paused withdrawals, swaps and transfers on its platform. As of 22 June, the token is trading at $0.9449, down 88% from its all-time high. 

Celsius price prediction

WalletInvestor is extremely bearish, calling CEL a “bad” long-term investment. Its Celsius price prediction for 2022 suggests CEL will lose most of its value this year and drop to $0.07 in December.

DigitalCoinPrice is bullish. It thinks CEL will race to $1.30 in July, representing an upswing of almost 38%. The site forecasts a yearly average of $1.38 in 2023 and $1.37 in 2024. The site’s Celsius price prediction for 2025 is $1.83, but $1.73 in 2026 and $2.32 in 2027. The site forecasts a value of $2.93 and $3.83 for 2028 and 2029 respectively. The Celsius price prediction for 2030 is a value of $4.30.

The CEL price prediction from Gov Capital is even more ambitious. It thinks the token will reach $7.16 in a year and a staggering $46.17 in five years’ time.

Celsius seems to have won over analysts and investors with the launch of its new DeFi platform. Many are hopeful this could be a successful era for the banking platform. But there are still a lot of established platforms in the DeFi industry to compete with, and Celsius appears to have been particularly affected by the recent crash.

FAQs

At the time of writing on 22 June, there are more than 238 million CEL in circulation. It has a maximum supply of 695.66 million CEL (approx 34% in circulation).

It might be. Celsius has seen many investors warm to the centralised finance platform. However, CEL has lost a lot of its value over the past few months, corresponding with the bearish crypto market. Remember, you should always do your own research before investing.

WalletInvestor forecasts the Celsius token will lose most of its value in 2022, but some remain optimistic. Cryptocurrencies can be volatile and hard to predict, so you should never invest more than you can afford to lose.

It depends. Celsius has marked a new era after launching its own decentralised finance platform that prioritises interoperability. CEL has shown signs of recovery, but it is still much lower than its previous all-time high.

Always remember cryptocurrencies are highly volatile assets and that past performance is never a guarantee of future results. Any decision to invest should be based on your attitude to risk, your expertise in this market, the spread of your portfolio and how comfortable you feel about losing money. Never invest more than you can afford to lose.

Further reading

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