Celsius not yet at the bottom of the hole? – The descent into hell continues for Celsius Network (CEL), especially for its aggrieved customers. Since freeze on crypto withdrawals on June 13, scandalous revelations follow one another. One of the latest accuses Celsius of having lied on the financial health of the company since 2021.
Vermont financial regulation accuses Celsius
It will soon 2 months what company Celsius placed under the protection of chapter 11 of the bankruptcy code the United States. And the end of the tunnel still seems fine link for service lending.
In a new document official versed in the ongoing legal process, the Vermont Department of Financial Regulation accuses Celsius and its CEO Alex Mashinsky to have made “false and misleading” statements to their customers. Worse still, the lies about the precarious situation of the company would have started from 2021.
“In fact, preliminary analysis of financial records provided to the Multi-State Regulators Group indicates that Celsius suffered massive losses in the first seven months of 2021. It also experienced two material negative events in June and July 2021. »
Excerpt from document
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Suspicions of CEL token price manipulation
To top it all off, the Vermont state finance authority suspects Celsius of having carried out course manipulation of the company token, the CEL. Alex Mashinsky’s teams allegedly bought CEL tokens on several occasions to make inflate the price artificially.
“Credible allegations have been publicly asserted through letters to the Court and otherwise, that Celsius and its management have engaged in improper price manipulation of the CEL token, including using the proceeds of deposits from its investors to acquire CEL tokens and increase its net position in CEL. »
Excerpt from document
And that’s the most serious of all for the end. The regulator squarely accuses Celsius of having used nothing more or less than methods worthy of a Ponzi when his financial health worsened. The company would thus have used the new deposits in order to be able to pay the interest of funds already deposited :
“Celsius also admitted (…) never earned enough income to support the returns paid to investors. This shows a high level of financial mismanagement and also suggests that at least at times the returns of existing investors were likely paid for with the assets of new investors. »
Excerpt from document
Celsius is definitely in a very bad posture. Under these conditions, it is not certain that its bitcoin mining activityauthorized in mid-August by the bankruptcy judge, is enough to raise the bar for this sinking crypto ship.
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