DeFi giant Celsius halts withdrawals, market fears $20bn crash

By Raffaele Redi

The company, which touts nearly 18% returns, could sell off key assets to DeFi platform Nexo

Celsius CEL coin symbol                                 
Celsius’s native token CEL is under selling pressure on the crypto markets – Photo: Shutterstock

Celsius Network LLC, a decentralised finance (DeFi) platform and one of the largest crypto lenders, paused all withdrawals, Swaps, and transfers between accounts, citing “extreme market conditions.”

“We are taking this action today to put Celsius in a better position to honour, over time, its withdrawal obligations,” said the network in a post published on, Monday 13 June 2022.

The announcement, reminding investors of the recent UST stablecoin crash, prompted a sell-off wave on the crypto market. It also led to the intervention of Nexo, a popular cryptocurrency lending, exchange and debit card company based in Bulgaria, which said that it wishes to acquire “any remaining qualifying assets of Celsius, mainly their collateralised portfolio”.

“We are putting together an offer to Celsius to that accord and will communicate it publicly,” tweeted Nexo. Nexo also claimed that “yesterday we reached out to the Celsius team to offer our support, but our help was refused”.

Meanwhile, rumours have been circulating about a possible $320m transfer to another crypto exchange just before the announcement was made. has not been able to verify these rumours.

Market fears another $20bn crash

The US-based Celsius Network LLC, which advertised an annual return of up to 17.78% on certain cryptocurrencies for retail investors – Do Kwon’s company, Terraform Labs, promised around 20% on its products – appears to have had $24bn of assets under management as of September 2021.

According to an SEC filing, the company tried to sell an undisclosed number of securities in April 2022, but the sale ended up with $0 of securities sold.

Previously, Celsius, like several stablecoins, received two orders from regional regulators in the US demanding that it withdraw its services in two US states, namely Texas and Alabama.

In February 2022, the Texas State Securities board imposed a cease and desist order on the company, which it said had violated Sections 7 and 12 of the Securities Act as the company did not register its crypto offer to the Securities and Exchange Commission (SEC) while allegedly “not disclosing material information necessary for investors.”

Previously, the state of Alabama had issued a similar order as the company has not registered its offering under the Securities Act, allegedly violating national rules.

On the crypto market, according to CoinMarketCap, Celsius’s native token Celsius (CEL) is trading down by 50% over the past 24 hours at $0.1949. CEL’s market cap was $47.5m while trading volume was around $36.7m, with sales pushing it higher by 84%.

Celsius Network LCC did not immediately respond to a request for comment. All prices correct as of 13:00 BST (UTC +1).

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