Debt Repayment Efforts
Celsius (CEL) has made substantial strides in repaying its outstanding debts to the Maker (MKR) protocol. Since the start of the month, they’ve tackled a commendable $142.8 million worth of Dai (DAI) stablecoins, spread across four transactions. Such moves signal Celsius’s intent to dodge a potential collapse, as whispers of insolvency circulate in the crypto community.
Current Debt and Losses
After these repayments, Celsius is still staring down a staggering $82 million debt to Maker. To put things in perspective, the firm has seen $1.8 billion in lifetime investments but is currently grappling with losses that total around $667.2 million. It’s a wild world in crypto, and Celsius seems to be in the middle of a storm.
Changing Liquidation Prices
Thanks to the recent loan repayments, the liquidation price on Celsius’ Wrapped Bitcoin (wBTC) loan has plummeted to $4,966.99 Bitcoin (BTC). This is a significant drop of nearly 50% since they made a pivotal $64 million DAI payment on July 4, just hours after sighting a $50 million DAI payment.
The Wider Crypto Context
Celsius is not alone in this tumultuous landscape; it finds itself among several once-reputable crypto companies teetering on the edge of insolvency. The recent bear market has dealt severe blows, leading to historic losses. In a reactive measure, Celsius paused withdrawals in mid-June, moving to restructure under new legal counsel as rumors swirled of Goldman Sachs possibly acquiring its assets.
Community Reactions and Future Prospects
With all this drama, one has to wonder—will a short squeeze in the Celsius community come to fruition? Despite evident liquidity issues, Celsius was still paying rewards as recently as last week. Alas, users can only watch their rewards accrue, as they remain tethered to the platform with no ability to withdraw due to ongoing liquidity constraints.
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