Overview of Celsius’ Asset Liquidation
Bankrupt crypto lending platform Celsius has initiated the liquidation of its digital assets, selling approximately $60 million** worth of **LINK, MATIC, SNX, and AAVE** tokens. The funds were transferred to an institutional exchange, with ongoing sales expected until Celsius fully liquidates its remaining **$100 million crypto holdings.
Key Details:
- Assets Sold: LINK ($19.2M), MATIC ($13.6M), SNX ($7.8M), AAVE ($7.3M), plus minor amounts of BNB, UNI, and others.
- Market Impact: Tokens experienced slight price declines, though the sales volume was relatively low.
- Exempt Tokens: 1INCH and LINK showed resilience—1INCH due to a temporary pump, and LINK buoyed by its new Cross-Chain Interoperability Protocol (CCIP).
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Celsius’ Bankruptcy and Asset Conversion
Timeline of Events:
- July 2022: Celsius filed for Chapter 11 bankruptcy under U.S. insolvency proceedings.
- July 2023: Approved to convert altcoins to BTC/ETH, with on-chain movements beginning July 13.
- Current Phase: Liquidation via institutional exchange FalconX, targeting $100M in remaining assets.
Stablecoin Holdings:
Celsius retains 24.1M USDC and 2.5M USDT, which could fuel BTC/ETH buys—potentially sparking a market rally.
Fallout for CEL Token Holders
The CEL token ($103.1M held by Celsius) faces high dump risk, with its price already under severe pressure. A full liquidation could trigger further declines.
Legal Actions Against Celsius and CEO Alex Mashinsky
Charges and Arrest:
- CEO Alex Mashinsky: Arrested for fraud, market manipulation, and securities violations.
- Company Settlement: Celsius agreed to a $4.7B creditor compensation plan via FTC.
Industry Reactions:
- Peter Schiff (crypto critic) publicly condemned Mashinsky’s actions.
- Community Sentiment: Broad approval of Mashinsky’s arrest, seen as accountability for mismanagement.
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Creditor Compensation Efforts
Celsius partially recovered funds through:
- MEV staking: Generated $10M in 10 months.
- GK8 Sale: Divested for $25M (96% allocated to legal fees).
FAQs
1. Why did Celsius sell LINK, MATIC, and other assets?
To liquidate holdings as part of its bankruptcy proceedings, converting altcoins to BTC/ETH per court approval.
2. How does this affect CEL token prices?
CEL risks a steep drop if Celsius dumps its $103.1M holdings, exacerbating existing price declines.
3. What’s next for Celsius?
Continued asset sales, creditor repayments, and legal resolutions under U.S. oversight.
4. Did the CEO face consequences?
Yes—Alex Mashinsky was arrested for fraud and market manipulation.
Conclusion
Celsius’ liquidation marks a pivotal moment in crypto’s ongoing regulatory reckoning. While the immediate market impact is muted, the saga underscores the risks of centralized lending platforms and the importance of transparency.