Thursday, July 25, 2024

US: State regulators investigate Celsius Network’s move to suspend withdrawals.

Securities regulators from the states of Kentucky, Alabama, Texas, and New Jersey as well as Washington are looking into Celsius Network’s decision to suspend customer redemptions. Earlier this week, the crypto lender, announced that it was pausing withdrawals, swaps, and transfers between accounts due to extreme market conditions.

Joseph Rotunda, Texas’ director of enforcement, told Reuters that the probe will be a priority. He expressed concerns that clients need immediate access to their assets, but are unable to withdraw from their accounts. Rotunda said this may result in significant financial consequences. Joseph Borg, the Alabama Securities Commission Director, highlighted that Celsius has been responsive to questions from the regulators. Currently, investigations are in the initial stages. Borg shared that the US Securities and Exchange Commission (SEC) has also been in touch with the crypto firm.

The respective regulators came to know of Celsius’s move from the company’s official blog post. It read that the company needed to take action to stabilize liquidity. Regulators in Kentucky, New Jersey, and Texas, in September, struck Celsius with a cease and desist order. They said the company’s interest-bearing products should be registered as a security.

Celsius is in the doldrums after its investments soured. As such, it was unable to meet redemptions from customers amid a crypto market crash. It seems that Celsius is near to a shutdown, similar to the collapse in the Terra ecosystem after its algorithmic stablecoin depegged. Furthermore, Bitcoin is toiling at new lows at the $20,000 mark and Ethereum is about to slip into three-digit figure.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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