- The Securities and Exchange Commission was also in contact with Celsius.
- The firm has temporarily suspended Customer withdrawals, swaps, and transfers.
State authorities are investigating Celsius in four separate jurisdictions for blocking consumer accounts due to solvency issues. As a result of Celsius’ decision to restrict client money withdrawals, regulators have opened an inquiry against the company.
According to Reuters, Alabama, Kentucky, and New Jersey state securities authorities are joining the Texas State Security Board’s investigation into Celsius’ recent conduct. A “priority” investigation, according to Texas Director of Enforcement Joseph Rotunda, started as soon as officials began probing the freezing of accounts on Monday morning.
Investors Withdraw Support For Bailout
Furthermore, Director Joseph Borg of the Alabama Securities Commission told Reuters that the Securities and Exchange Commission (SEC) was also in contact with Celsius and that the business has responded to authorities queries.
Celsius is a crypto lending platform with a return rate of up to 18% on crypto-assets like Bitcoin and Ethereum. With this strategy, it may benefit from decentralized finance (DeFi) protocols while functioning as a centralized custodian for its customers. The firm has temporarily suspended Customer withdrawals, swaps, and transfers to safeguard its financial viability and ensure that it can be “in a better position to honor, over time, its withdrawal obligations.”
Investors who had previously led Celsius’s Series B investment round were not expected to come to the firm’s rescue, according to reports at the time. More than $3 billion was valued at more than $750 million in the crypto startup’s Series B financing. Nexo, a competitor crypto lender, has shown an interest in purchasing Celsius’ collateralized loan assets to compensate its consumers.
Recommended For You: