Cory Klippsten, the managing Director of Swan Bitcoin, is convinced that the impending insolvency of the crypto savings bank Celsius Network could herald the general end of the classic crypto savings platforms. German Bitcoin savers at Nuri should also be attentive in view of this forecast.
“Whether you run a well-managed centralized crypto savings platform or a poorly managed one, this domino effect is very likely to affect all centralized crypto savings platforms,” as Klippsten assesses the current situation in an exclusive interview with Cointelegraph.
The crypto savings bank Celsius, which has been the leader among the crypto industry’s savings platforms so far, imposed a withdrawal freeze at the beginning of the month, presumably to prevent an impending insolvency. As a result, influential crypto lenders such as Babel Finance and Three Arrows Capital (3AC), which are closely interwoven with Celsius and other savings platforms, have now also started to swim.
According to Klippsten, this domino effect will only get worse and possibly destroy an entire sector of the industry. And even if it does not happen, the crypto expert assumes massive cuts on the part of regulators, which could finally destroy the crypto-savings platforms.
However, this is a positive development for the managing director of Swan Bitcoin, because he has been sharply criticizing centralized savings platforms for some time anyway, because they “collect the crypto assets of private investors in order to lend them for profit and generate minimal interest for investors”.
A rather questionable business model as the proven Bitcoin maximalist finds, because in addition, the centralized platforms are mostly “opaque” in their business activities and the “investors do not pay adequately for the risk they bear”.
A practice that, according to Klippsten, is doomed to failure, which is why he assumes that Celsius will ultimately not be able to save himself.
This is bad news for all savers who have invested their crypto assets with the platform, because in the event of insolvency, the expert sees the small private investors in last place among the creditors, especially since they also have no legal claims.
It may also be bad news for German crypto investors, because the Berlin fintech Nuri works closely with Celsius for its Bitcoin earnings account. So if the experienced head of the industry is right, then the affected Nuri customers can now assume a total loss of their Bitcoin (BTC).
You can watch the entire interview with Cory Klippsten on the Cointelegraph YouTube channel. Don’t forget to like and subscribe!
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