Key Takeaways:
- Lending platform Celsius Network has started selling altcoins, likely to convert them into Bitcoin or Ether.
- The platform filed for bankruptcy in 2022.
NEW DELHI (CoinChapter.com) — Crypto lending platform Celsius Network has started to sell its altcoin holdings, per data tracked by Lookonchain.
In a July 17 tweet, the platform revealed that Celsius transferred nearly $25 million worth of altcoins to the crypto trading platform FalconX. These tokens include 1.27 million Chainlink (LINK), 2.83 million Synthetix (SNX), 4.45 million 1inch (1INCH), and 439,000 FTX Token (FTT).
Moreover, Celsius also deposited over 186,000 BONE tokens (worth $235,000) into the crypto exchange OKX.
The move was not surprising, considering the defunct crypto lender had announced plans to sell its customers’ deposits and use the funds to buy Bitcoin (BTC) and Ethereum (ETH) tokens.
Celsius’s new reorganization plan proposed to deal with customers’ complaints through the set-off treatment. In detail, the method compares the losses to the profits in a given year to calculate the claim amount.
The United States Bankruptcy Court for the Southern District of New York approved the crypto lender’s plan on June 30.
Celsius’s Altcoin Sell-off Comes Days After CEO’s Arrest
Meanwhile, another interesting incident in the run-up to the altcoin sell-off was the arrest of former Celsius CEO Alex Mashinsky on July 13. The embattled crypto lending platform agreed to a $4.7 billion settlement with the Federal Trade Commission (FTC).
Federal authorities had leveled security fraud charges against Mashinsky and Celsius. Furthermore, the SEC and the Commodity Futures Trading Commission (CFTC) have accused the CEO of scheming to defraud investors.
Interestingly, Celsius’s settlement with the FTC was one of the largest in the regulator’s history, coming a close second to Meta’s $5 billion fine in 2019. The FTC settlement payment would come after the company returns customers’ assets.
The US Attorney’s office stated in a charging document that the Celsius CEO misrepresented the “safety of Celsius’s yield-generating activities.”
Moreover, the SEC alleged that Celsius and Mashinsky fraudulently manipulated the prices of Celsius’s native token, CEL.
Celsius starting its altcoin sell-off could be a hurdle to the altcoin market’s recent rally following Ripple’s win in the lawsuit against the SEC. At writing, the CEL token changed hands at $0.162 per token.
