‘Extreme market conditions’: Crypto firm Celsius pauses transfers & withdrawals

livemint.com:

Cryptocurrency lending firm Celsius Network will pause withdrawals and transfers between accounts due to "extreme market conditions", the company said on Monday, in the latest sign of pressure in the crypto industry.

Celsius’s CEL token sank 53% to 18 cents as of 11:13 a.m. in Hong Kong, according to pricing data site CoinGecko, pacing a slump in crypto assets that sent Bitcoin to its lowest level since December 2020.

Doubts about the sky-high yields backing protocols such as Celsius have intensified after Terra’s collapse in May and as tighter monetary policy from global central banks curbs demand for riskier assets. The CEL token promises “actual financial rewards," including as much as 30% extra returns weekly, according to its website.

“We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations," the platform said in a memo on its website, adding that users will continue to accrue rewards during the pause.

Bitcoin extended earlier declines after Celsius's announcement, falling more than 6% to as low as $24,888, an 18-month low. Ether, the world's second-largest cryptocurrency, dropped more than 8% to $1,311, its lowest since March 2021."We are taking this necessary action ... in order to stabilize liquidity and operations while we take steps to preserve and protect assets," the company said. 

"Furthermore, customers will continue to accrue rewards during the pause in line with our commitment to our customers."

Celsius Network, which raised $750 million in funding late last year, is a significant player in crypto lending. It offers interest-bearing products to customers who deposit their cryptocurrencies with the company, and lends out crypto currencies to earn