Amid the ongoing crypto market crash, the Celsius token continues to get dragged through the mud. The latest analysis by the on-chain and social metrics firm, Santiment ascertained that Celsius price is expectedly down followed by the network’s profit loss showing almost only loss last few months. However, the Whale movement for Celsius stood out with its odd trajectory.
According to Santiment,
“Big token holders are not panicking, they are pulling down slowly. Their reaction to filing for bankruptcy is quite calm compared to earlier moves”.
While this may seem odd, the celsius whale movement analysis only ascertains — a negative reading indicates that more holders will incur losses if they sold the cryptocurrency at the prevailing price. This is exactly what the santiment analysis also highlights the only reason Whales are not heavily offloading is that they simply can not do that without incurring a hefty loss.
It is a lose-lose situation for whales who decide to take the panic sell-off route, but for those big token holders who continue to HODL through the worst bears, there is still a slight possibility of consolidation when the bull finally hits.
Celsius Fails Court Of People
Earlier this week, there was hope that the ongoing DeFi industry turmoil had finally started to resolve after Celsius paid off over $81 million in debt to Aave and reclaimed $410 million of its staked ether (stETH). Nevertheless, soon after the debt repayment and retrieving its collateral, Celsius filed for bankruptcy. Followed by the bankruptcy filing, it was unveiled that the lending giant owes its users $4.7 billion, which it currently cannot afford to reimburse.
While trust in Celsius dropped to negative, a recent class action lawsuit filed by an investor accused the company’s entire business model itself of resembling that of a “literal Ponzi scheme”. According to Law360, the lawsuit against Celsius is filed in the U.S. state of New Jersey, alleging that the company lost roughly $10 billion worth of assets by trading unregistered securities in a Ponzi scheme.
The report stated,
“Much like a literal Ponzi scheme, Celsius could only maintain its yield rate promises by continually bringing in new investors whose new influx of money would be used to pay off the yield for old investors.”