{"id":13259,"date":"2022-07-17T12:53:58","date_gmt":"2022-07-17T12:53:58","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/celsius-bankruptcy-is-not-surprising-tezos-co-founder-says\/"},"modified":"2022-07-17T12:53:58","modified_gmt":"2022-07-17T12:53:58","slug":"celsius-bankruptcy-is-not-surprising-tezos-co-founder-says","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/celsius-bankruptcy-is-not-surprising-tezos-co-founder-says\/","title":{"rendered":"Celsius’ bankruptcy is not surprising, Tezos co-founder says"},"content":{"rendered":"

(Originally posted on : CoinJournal: Latest Bitcoin, Ethereum & Crypto News )<\/b>
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Tezos co-founder Kathleen Breitman says the eventual filing for bankruptcy by embattled crypto lender Celsius Network is not surprising at all.<\/p>\n

Breitman, commenting on the unfortunate turmoil that\u2019s threatening to suck any pending warmth from an already cold crypto winter, said the lender\u2019s trajectory towards trouble was inevitable.<\/p>\n

The die was cast for Celsius<\/h2>\n

According to the Tezos co-founder, a suspect business model, underpinned by the massive yield offered to investors and the crypto price crash spelled bleakness for the likes of Celsius.<\/p>\n

So when crypto hedge fund Three Arrows Capital collapsed and filed for bankruptcy, followed by crypto brokerage Voyager Digital, the die was cast for Celsius.<\/p>\n

The lender, which paused customer withdrawals in early June, indicated in its filing that total liabilities stand at $5.5 billion, with over $4.7 billion owed to users. However, the total assets are about $4.3 billion to leave a $1.2 billion hole in the balance sheet.<\/p>\n

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#Celsius<\/a> is missing $1,190,000,000. @Mashinsky<\/a> destroyed everyone. If you lost money to him or his scheme, you did so because you straight up ignored me begging to save you. pic.twitter.com\/Z7BjoqkzJ8<\/a><\/p>\n

\u2014 Richard Heart (@RichardHeartWin) July 15, 2022<\/a><\/p>\n<\/blockquote>\n

Before the bankruptcy filing, Celsius had been hit by a class action lawsuit brought by a former employee. The lawsuit alleged that the crypto lender had, among other things, disregarded risk management practices and even manipulated the market by artificially inflating the price CEL, its native token.<\/p>\n

Before hitting the wall, the lawsuit alleges Celsius had operated more like a Ponzi scheme, using new customer deposits to sustain withdrawals.<\/p>\n

These are the events that paint a picture of a company doomed to fail.<\/p>\n

\u201cFor those of us who\u2019ve been in this industry for quite some time, it\u2019s completely unsurprising that something like Celsius would go bankrupt<\/em>,\u201d she\u00a0told<\/u><\/a> Bloomberg Technology<\/em>.<\/p>\n

She added that this outcome was likely \u201cbecause economics does have laws that transcend the word blockchain.<\/em>\u201d The unfolding, she explained, is a \u201cshakeout\u201d of what wouldn\u2019t just work \u2013 especially for businesses that staked their future on \u201cthe theory that numbers will always go up<\/em>.\u201d<\/p>\n<\/p><\/div>\n