A week after freezing withdrawals, embattled crypto lending platform Celsius Networks Ltd. said Sunday that that it will “take time” to stabilize its liquidity and operations.
Last Sunday, Celsius, one of the largest crypto lending platforms, announced it was “pausing” withdrawals, swaps and transfers “due to extreme market conditions.”
In a blog post Sunday, the New Jersey-based company gave an update on its situation, saying: “We want our community to know that our objective continues to be stabilizing our liquidity and operations. This process will take time.”
“As has been a priority since our company’s inception, we maintain an open dialogue with regulators and officials. We plan to continue working with regulators and officials regarding this pause and our company’s determination to find a resolution,” Celsius said.
The company added that it is also pausing its Twitter Spaces and Reddit AMA’s “to focus on navigating these unprecedented challenges and seeking to fulfill our responsibilities to our community.” On Friday, Celsius abruptly canceled an AMA — Ask Me Anything — session with its CEO minutes before it was to start.
Also Sunday, users of crypto lending app Solend, which works off the Solana blockchain, voted to take over the platform’s largest account — a so-called “whale” — in a bid to preserve its liquidity and prevent excessive strain on the Solana network.
“Letting a liquidation of this size to happen on-chain is extremely risky,” Solend said in a blog post. “DEX liquidity isn’t deep enough to handle a sale of this size and could cause cascading effects.” Users were urged to “grant emergency power to Solend Labs to temporarily take over the whale’s account so the liquidation can be executed OTC and avoid pushing Solana to its limits.”
However, Solend said late Sunday it may invalidate that move following criticism over how the takeover process was conducted. It extended voting time by one day and said it will work on a new proposal that does not involve emergency powers to take over the account. “But we need to act swiftly to address the systemic risk and fact that normal users can’t withdraw USDC,” Solend said.
Celsius’ troubles last Sunday kicked off a rocky week for the crypto market, as bitcoin and other digital currencies continued their plunge, with crypto hedge fund Three Arrows Capital taking deep losses and fellow crypto lender Babel Finance also freezing withdrawals.
Meanwhile, crypto lending platform BlockFi announced it would slash about 20% of its workforce, and crypto trading platform Coinbase said it would lay off 18% of its workers.
Bitcoin BTCUSD, -2.62% has lost about 70% of its value since hitting an all-time high in November. Over the weekend, bitcoin slid below the $20,000 level, its lowest point in 18 months, though it briefly crept back above that level Sunday.