Celsius today made a $10 million refund to Compound Finance. So, he probably took a step towards showing his solvency. Celsius had disabled withdrawals, transactions and swaps a week ago. Still did not re-enable these services. The price of Celsius’s CEL token is rising. However, this rise is thought to be due to a short squeeze rather than a real recovery. Here are the details…
Celsius pays back $10 million
Celsius today made a substantial payment to Compound for transferring $10 million of DAI to the platform. The project sent $10 million worth of DAI stablecoin to Compound Finance, a popular DeFi service. The Etherscan block explorer states that the firm has repaid 10 million DAI and also collected 166 COMP ($5,200). Celsius also made other refunds last week. For example, it paid 53.6 million DAI to Oasis Protocol, another profitable DeFi platform.
Celsius uses various DeFi protocols to engage its customers. His latest $10 million payout likely means he’s closing positions with these services to regain liquidity and reopen withdrawals for his clients. While this is likely a step towards solvency, today’s $10 million payout is only a small part of Celsius’ business. For example, during the week of May 6, the company saw $397 million in inflows and $1 billion in outflows. Therefore, if demand remains excessively high, the firm may not be able to accommodate withdrawals.
Celsius’s services are still unavailable
It’s been a week since Celsius suspended services. As Cryptokoin.com also reported, the company disabled withdrawals, transactions and exchanges on June 13. Actually, today’s transaction came after Celsius released an update. According to the update, transactions will continue to be suspended.
“Our goal is to stabilize our liquidity and operations,” the firm wrote on June 19. He added that this “will take time” and that they will “continue to operate 24 hours a day”. Celsius also noted that it will cooperate with regulators and authorities. Last week, regulators from four US states launched an investigation into the situation. Celsius added that it will pause Q&A activities to prioritize resolving the current situation.
CEL price rising
Celsius’ decision to suspend operations has caused panic in the crypto market as Bitcoin prices have dropped significantly. The price of BTC started at $28,000 on June 12. However, it fell below $18,000 during the week. BTC is worth $20,500 at the time of writing. Investors seem dissatisfied with Celsius’s course of action. Social media users are trying to short squeeze to artificially increase prices and take advantage of the short-term advantage that may arise.
Indeed, the value of Celsius’s native token has soared since the firm announced it would freeze funds. The price of CEL dropped from $0.44 to $0.15 on June 12. Now, it is trading at $1.48. It draws attention especially with the increase of 124 percent in the last 24 hours. The coin rose from its daily low of $0.64. However, according to experts, this improvement appears to be largely due to the short squeeze attempt.
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