Bitcoin plunges as major crypto lender halts operations
Bitcoin and other cryptocurrencies were collapsing in price Monday, after the major crypto lender Celsius halted all withdrawals citing “extreme market conditions."
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Bitcoin and other cryptocurrencies were collapsing in price Monday, after a major crypto lender halted all withdrawals citing “extreme market conditions.”
It is the second collapse of a part of the cryptocurrency world in the last two months. The stablecoin Terra imploded in early May, erasing tens of billions of dollars in a matter of hours.
Bitcoin was trading at roughly $22,600 as of midday Monday, down more than 17% in the past day. Ethereum, another widely-followed cryptocurrency, was down more than 20%.
On Sunday, the lending platform Celsius announced that it was pausing all withdrawals and transfers between accounts in order to “honor, over time, withdrawal obligations.” Celsius, with roughly 1.7 million customers, gave no indication in its announcement when it would allow users to access their funds.
“There is a lot of work ahead as we consider various options, this process will take time, and there may be delays,” it said.
Celsius is one of the bigger cryptocurrency lending platforms, with more than $11 billion in customer assets. In exchange for customers’ deposits, the company gives out extremely generous yields, upwards of 19% on some accounts. These lending platforms have come under scrutiny recently because they offer yields that normal markets could not support, and critics have called them effectively Ponzi schemes.
Terra, and its token Luna, offered similar yields on customer deposits. Those tokens collapsed after huge customer withdrawals forced Terra's operators to liquidate all of the assets being used to support their currencies. The collapse of Terra has spurred calls for reform from the cryptocurrency industry, and calls for Congressional regulation.