Amidst the crypto market going through huge crashes and seeking steep decline, crypto lending protocol Celsius freezed it’s operations
This came as quite a surprise when a prominent cryptocurrency lending platform showed its interest to buy yet another crypto lending platform. There were talkings all over the space when Nexo proposed to buy certain assets from its rival crypto lending platform Celsius. The latter announced that the lending platform is stopping its operations related to withdrawals and transfers given the extreme market conditions.
On Monday, Nexo sent a letter to Celusius in which it stated the lending protocol is interested in the collateralized loan portfolio of Celsisus. Nexo has made the letter public while sharing it via Twitter however did not mention any price for buyout.
Earlier on Monday itself, Celsius lending protocol in a blog post announced that it would freeze its product’s swap and transfer. While the blog post had not mentioned any specific timeline since when the withdrawals will be resuming. The announcement from Celisus came after the lending protocol told its non accredited investors that they could not transfer funds any longer.
Celsius said that they are working towards their sole focus to preserve and protect their assets in order to meet their responsibilities to customers. The ultimate objective of lending protocol is to stabilize the liquidity and restore the withdrawals amount, to make the swap and transfer process seamless between the accounts quickly. Further, Celsius stated that it has a lot of work to do ahead as they are considering various other options so this process will be time taking and there are chances it would be stuck into delays.
The crypto market in recent weeks has plunged drastically considering the weak macroeconomic environment. Top cryptocurrencies including bitcoin (BTC) and Ethereum (ETH) had been down for more than 12 weeks straight. It was just in March this year when bitcoin was trading at around $49,000 that slid to below $23,000 at the time of writing.
Global market capitalization of the overall cryptocurrency market was at its peak in November, 2021 that has recently dropped and slid down below $962 billion as per today.
In its letter, Switzerland based lending protocol Nexo said that it was looking to acquire these assets that are mostly or entirely collateralized loan that are receivables secured by collateral assets corresponding to it alongwith brand assets and customer database.
Source: https://www.thecoinrepublic.com/2022/06/14/why-did-crypto-lending-platform-nexo-propose-to-buyout-rival-platform-celsius/