News updates June 13, 2022
1. Shortly before Halting Withdrawals: Celsius Transferred $320M Worth of Crypto to FTX.
Just hours before halting withdrawals, Celsius transferred over $300 million in various cryptocurrencies to FTX without giving a reason.
The controversial events surrounding Celsius Network continue to unfold as the team unstaked hundreds of millions of dollars in crypto from Aave and transferred them to FTX. So far, the project has not provided a reason why, but social media speculations are running rampant.
The transactions began during the weekend, with the first batch seeing 3,500 Wrapped BTC (worth $89 million at the time) and 50,000 ETH. The amount continued to increase in the following hours.
On-chain data shows that Celsius has sent over 100,000 ETH to FTX in the past few days, as well as 9,500 WBTC. However, the staking and lending platform has also transferred other tokens, including FTT, MATIC, UNI, USDP, and TUSD, to the exchange. Overall, the total amount sent now is around $320 million.
As of writing these lines, Celsius is yet to comment on the transfers. The only communication that came from the team was an official announcement halting all user services, including withdrawals.
This came after the firm had transferred the aforementioned funds to FTX and just hours following an interesting comment made from Celsius CEO – Alex Mashinsky. Answering a Twitter post about potential issues with his platform, Mashinsky asked:
Mike DAOdas ( , )
Jun 12, 2022
Replying to @cory_eth and @CelsiusNetworkI hope retail can get out. I’ve been hearing about accounts locked. That would be similar to LUNA. We shall see.
While Celsius is yet to shed some light on the transfers to FTX, the crypto community speculates on Twitter that they came due to liquidity issues.
According to one user, the company has faced such problems for the past several months as previous hacks harmed its reserves, and it lost some funds in LUNA and Anchor Protocol.
The user also estimated that Celsius customers withdraw 50,000 ETH weekly while determining that the platform can continue working properly for approximately five weeks before defaults or bankrupts.
2. Binance Temporarily Halts Bitcoin Withdrawals Amid Market Mayhem.
Cryptocurrency exchange Binance has temporarily halted Bitcoin withdrawals due to extreme market turbulence, according to a tweet posted by CEO Changpeng Zhao.
Zhao has assured users that their funds are safe, claiming that the suspension of withdrawals is linked to a backlog caused by a stuck on-chain transaction.
The Binance team is currently working on a solution, an official announcement says. Zhao claims that the problem is expected to be fixed in half an hour.
Major cryptocurrency exchanges typically experience performance issues when there is severe market volatility.
Earlier today, the price of the largest cryptocurrency collapsed to as low as $23,964 on the Bitstamp exchange, extending its bearish streak.
The total cryptocurrency market capitalization has dropped below the $1 trillion level for the first time since January 2021 amid the worsening sell-off.
Roughly $316 million worth of cryptocurrencies have been liquidated over the past four hours alone, according to data provided by crypto analytics firm Coinglass.
The cryptocurrency market has been pummeled by a double-whammy of worsening macro conditions and the Celsius imbroglio. As reported by U.Today, one of the largest cryptocurrency lenders paused all withdrawals earlier today, stoking fears among cryptocurrency enthusiasts, with its native token losing more than half of its value.
Binance is the world's largest exchange in terms of trading volumes. Over the past 24 hours, it has recorded $28.7 billion worth of spot traders, dwarfing its closest competitors (FTX and Coinbase), according to data provided by CoinMarketCap.
3. Binance.US Accused of Misleading Investors in Class Action Lawsuit Over Terra
A class action lawsuit against Binance.US has been filed on behalf of investors in connection to the collapse of Terra USD (UST).
“Those of you waiting for the earth to become unstable- I'm afraid you will be waiting until the age of men expires.”
These confident words from Terra blockchain founder Do Kwon sought to convince crypto investors to put their trust (and money) into TerraUSD (UST), a stablecoin that Kwon promised would always stay priced at exactly $1. Unfortunately, Kwon’s confidence was not enough to save UST and the rest of the Terra as Kwon’s project dropped to zero
Now, over 2,000 Terra investors say false marketing is what caused them to lose their money.
In a class action lawsuit filed on Monday in North California, cryptocurrency exchange Binance.US has been accused of misleading investors surrounding the Terra blockchain ecosystem.
The suit marks the first major U.S.-based court filing relating to Terra, whose UST and LUNC tokens wiped out around $40 billion in investor funds when they crashed to pennies last month.
7. Bitcoin passes $23.8K May low as crypto market cap drops under $1 trillion
The crypto sell-off is in full swing and Wall Street has not even opened yet.
Bitcoin (BTC) faced continued selling pressure before the June 13 Wall Street open as Ether (ETH) revisited multi-year lows.
*Bitcoin battles for $24,000*
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD eclipsing its ten-month lows set in mid-May.
The largest cryptocurrency faced bearish triggers on multiple fronts, these coming from both within and beyond the crypto sphere.
FinTech protocol Celsius appeared on the brink of meltdown after operations were halted, turning billions of dollars in collateral into new risk for crypto markets. In an event ironically similar to that which caused the May rout, Bitcoin and altcoins kept falling as fresh uncertainty filled the air.
Macro conditions were hardly better, with Asian markets selling off and Wall Street futures looking set to continue the downtrend which set in last week.
Inflation concerns likewise remained ahead of crucial comments from the United States Federal Reserve due June 15.
5. Russian Parliament to Review Bill Prohibiting Crypto Payments
Legislation making it illegal to pay with cryptocurrencies has been filed with the State Duma, the lower house of Russia’s parliament. The sponsors of the bill want to task crypto platforms to prevent transactions that could facilitate payments with digital assets.
6. The CFTC’s action against Gemini is bad news for Bitcoin ETFs
On June 2, 2022, the United States Commodity Futures Trading Commission (CFTC) initiated an action against Gemini, the crypto exchange founded by billionaire twins Tyler and Cameron Winklevoss. Among other things, the complaint alleges that Gemini made a number of false and misleading statements to the CFTC in connection with the potential self-certification of a Bitcoin futures contract, the prices for which were to be settled daily by an auction (the “Gemini Bitcoin Auction”). In the complaint, the CFTC specifically articulated the position that these statements were designed to mislead the commission as to whether the proposed Bitcoin futures contract would be susceptible to manipulation.
7. Celsius, Staked Ethereum (stETH) Are Pummeling DeFi Valuations
The DeFi space is facing a sharp drop in valuation amid concerns over the Celsius suspension and the Lido-staked Ethereum (stETH) de-pegging.
Data from aggregator DeFi Llama shows that the total value locked into DeFi shrank by nearly 20% in the last 48 hours, to a one-year low of $79 billion.
A mix of factors are influencing FUD in the DeFi space. Celsius’ recent suspension of withdrawals stemmed from the de-pegging of stETH from Ethereum (ETH) in secondary markets. This in turn has caused a shock selloff in ETH– one that has also extended to broader crypto markets.
8. MicroStrategy's Bitcoin Investment Is Close to Liquidation as It Is Down More Than $350 Million
One of biggest holders of Bitcoin is set for liquidation as Bitcoin is not stopping on its way down
Following Bitcoin's plunge below $25,000, it is necessary to remember the words of MicroStrategy's CFO about the potential of receiving a margin call at $21,000 on the company's massive BTC position.
During the earnings call on May 3, the new Chief Financial Officer, Phon Le, was describing the collateralization mechanism on MicroStrategy's Bitcoin position and told investors that the company will not need to put more funds into their positions.