New York (AP) – Bitcoin and other cryptocurrencies crashed on Monday after a major cryptocurrency lender suspended all withdrawals in “extreme market conditions”.
This is the second phase of the collapse of the cryptocurrency world in the past few months. Stabilcoin Terra exploded in early May, worth tens of billions of dollars in a matter of hours.
On Monday afternoon, Bitcoin was trading at approximately $ 22,600, down more than 17% yesterday. Ethereum, another widely used cryptocurrency, has fallen by more than 20%.
On Sunday, the Celsius lending platform announced that it will suspend all withdrawals and transfers between accounts to “meet its withdrawal obligations over time.” Celsius, which has approximately 1.7 million users, did not indicate in its statement when it will allow users to access their funds.
“There is a lot of work to be done, as we review some options, this process will take time and there may be delays,” the note read.
Celsius is one of the largest cryptocurrency lending platforms with over $ 11 billion in user assets. In exchange for customer deposits, the company releases very high profits, up to 19% on some accounts. These credit platforms have recently become the spotlight as they offer revenue that normal markets cannot support and critics have called them effective ponzi schemes.
Terra and its Moon symbol offer similar returns on consumer deposits. These tokens collapsed after large amounts of customer withdrawals forced Ground Operators to liquidate all assets used to support their currencies. The collapse of Terra has led to calls for reform in the cryptocurrency industry and regulatory requests by Congress.
Source: Huffpost
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