Crypto collapse is even worse

Welcome back to Defector Crypto Markets Assay, where we test the cryptocurrency market. Today’s result: bad.

Less than three hours after Alex Mashinsky, founder and CEO of Celsius, a major crypto lender, Some of the accused are investment people Spreading misinformation and “FUD” – fear, uncertainty and suspicion, I think there should be a readymade summary of any legitimate and unscrupulous business – I think we can agree. We’re announcing that Celsius is stopping all withdrawals, exchanges and transfers within the account. “Oops!

This is obviously bad — the bank that prevents you from withdrawing money fails to meet the most important qualifications for the bank — and although the details of this case are exemplary and verifiable, the most important thing here is Celsius sized companies and institutional scams, pumps, dumps, And the height is considered to be much more restraining than the instability that has drowned thousands of lesser competitors. The collapse of a firm like Celsius shows that none of this is big enough to fail.

On this specific topic: Celsius is basically a crypto bank, which operates on some traditional monetary policy, only the lending institution uses cryptocurrency instead of real currency; For that reason, it boasts of a foreign return that no traditional bank can offer realistically. Importantly, however, and significantly unlike traditional banks, the value of assets traded in Celsius is extremely volatile, and the firm is not FDIC insured, which means that customers want to get out of their shit before Celsius breaks out. And with whom such a collapse could be seen The firm plays musical chairs to stay fluid And its former CFO arrested in Israel on fraud charges? Critics have argued for months that Celsius is a textbook example of a calendar scheme, and you don’t know it, Insiders of Celsius took out a ton of money Just before the liquidity crisis hit the bank. The in-house token hit 15 cents last night after the announcement, down 5,333 percent from a year earlier.

The market impact of Celsius implosions ানো running on a bank without a railroad — could be more significant than the collapse caused by Lunar’s failure, which in May shook the Luna and its associated stablecoin (theoretically some form of real currency) market. (US)) েরা 2 billion worth of Terra USD has fallen since the sale of assets worth $ 2 billion (raising some obvious questions about the term “stable”). Caisse de Dépôt et Placement du Québec, Canada’s second-largest pension fund, led a major round of financing Celsius last October, with Mashinsky arguing that his company was the real deal, rather than a rickettsial bank with a key hostage. . And indeed, it is strange that CDPQ Celsius has paid off so much money in terms of the degree of regulatory screening. On the same day last September, New Jersey issued a ceasefire and a ceasefire, Texas began the process of seeking a ceasefire and a ceasefire and asked the Alabama Company to prove why it should not be banned from the state. One week later, Kentucky filed a ceasefire and withdrawal order of their own. New York Attorney General Letitia James also turned a blind eye to Celsius. Those who have invested Probably worse with Celsius, although Celsius himself invested so much wealth that the larger market is carrying weight.

Bitcoin has fallen to its lowest price in more than a year and a half today, while Etherium has fallen and the total market value of all cryptocurrencies has fallen below $ 1 trillion for the first time since January 2021. Anyone who invested in Bitcoin when Jack Dorsey and J-Z Their Bitcoin Academy has announced They have already lost 25 percent of their value last week. Similarly for anyone who listens Senators Kirsten Gillibrand and Cynthia Lumis dumped their retirement funds into Bitcoin. If you invest in the cryptocurrency advertised in Kara Swisher’s podcast, You will be down 25 percent. Binance, the world’s largest crypto exchange that has itself been the subject of several federal investigations, is now facing a class-action lawsuit, and Had to be postponed Bitcoin withdrawal on Monday., the company that now sponsors Lakers Arena, Five percent cut of his workforce. Coinbase stock is down just 13 percent today. Microstrategy, Bitcoin’s largest corporate holder, lost $ 1 billion in its Bitcoin investments, with its stock down 25 percent. If the price of Bitcoin drops below $ 21,000, they will have to pay more collateral for a loan from Silvergate, which could further shake the market.

After all, this is a serious setback for a sector that has already proven itself prone to all sorts of scandals and impulses. In the midst of trying to prove the legitimacy of the crypto industry, despite every sign pointing to massive and widespread institutional fraud, it has become increasingly difficult to sue anyone for this shit. Aside from the fictitious release of cryptocurrency and the actual practical application of blockchain, it is difficult to ignore or justify the reality of all this. Maybe soon the line will go up instead of down, but the Celsius fall, as was the case with the Luna fall, shows how even seemingly immovable firms fill up and their conflict relying on an inflationary hype cycle. Many large exchanges and crypto firms If the Celsius in the world is completely broken, or if they can’t move the way out of this jam in such a way that tokens and protocols keep them invested enough.

On one level, crypto is essentially a descriptive phenomenon, and with each passing crisis its story becomes increasingly difficult to believe (and then invest). Celsius and Binance and others might try to tell a better story.The current one Originally “when the walk gets harder, harder” – but at the moment, there’s nothing about their business model that would be described as “legitimate” in practice, so they can only dig themselves into a deep hole. Unfortunately, someone has already created a cryptocurrency called Fahrenheit, so they have to give up kelvincoins.

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