The crypto community is strongly criticizing the Celsius Network, because the crypto savings platform, which is acutely threatened with insolvency, continues to distribute weekly interest income to its users, although the company recently imposed a withdrawal freeze.
As previously reported, Celsius temporarily stopped all withdrawals on June 13 due to the market-wide crisis. However, it quickly became clear that the company itself is affected by massive liquidity problems and is probably even threatened with bankruptcy. Accordingly, users of the platform are now worried about the total loss of their invested cryptocurrencies.
Why is @CelsiusNetwork still paying rewards if apparently they are talking bankruptcy? Why not pause rewards and set a low withdrawal limit? Is it me or does that make too much sense?
– Crypto V (@crypto_kid2021) June 27, 2022
In view of this massive imbalance, the community is now wondering why Celsius is still distributing interest income. So Simon Dixon, CEO of the investment platform BnkToTheFuture, wonders vicariously why he was credited with almost $ 4,000 in crypto interest from Celsius yesterday Monday when he can’t withdraw his funds anyway:
“I just got an email from Celsius. I still can’t withdraw my money, but I still get my interest. What do you think of it? Should the interest continue to be distributed?“
Many other crypto users are still bothered by this practice on Twitter, so one of them even calls it “insulting” that Celsius records weekly interest income for investors on paper, while their assets are “held hostage” on the platform.
This is honestly insulting, @CelsiusNetwork is still paying weekly rewards while holding my crypto hostage. pic.twitter.com/Cst0iqNkDc
– CryptoSteve.eth (@CryptoStylesUSA) June 27, 2022
According to the website of Celsius – which is being rebuilt due to current developments – the platform still advertises with an annual interest rate of up to 18.63% for crypto savers. Such promises have long been criticized by experts as unrealistic, which makes it all the more questionable to stick to the distribution of interest with regard to the threat of insolvency.
A Bitcoin expert rather assumes that the Celsius case could mean the end for the classic crypto savings platforms.
