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Microstrategy, Tesla, and El Salvador Bitcoin Holdings Dip Over $1.3B Amid BTC Crash

Lele Jima
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Microstrategy, Tesla, and El Salvador Bitcoin Holdings Dip Over $1.3B Amid BTC Crash

The two biggest public companies holding Bitcoin suffered tremendous losses following the recent BTC price crash including the first country that acquired BTC as legal tender.


The recent Bitcoin (BTC) crash has plunged many investors of the top asset class into major losses, with a large chunk of their holdings in dollars wiped off.

Since June 10, 2022, Bitcoin has seen its value crash from above $30,000 to below $23,000. Following the massive crash of the world’s largest cryptocurrency by market capitalization, investors in the asset class have suffered major losses.

For instance, leading business intelligence company MicroStrategy and American electric car company Tesla have seen a large percentage of the Bitcoin value disperse into the wind, following the recent market crash.

MicroStrategy’s Bitcoin Holding Value 

It is no longer new that MicroStrategy is heavily invested in Bitcoin. The company is considered a major pioneer in spearheading the massive adoption of Bitcoin among institutional and corporate investors.

Since MicroStrategy commenced its Bitcoin accumulation in August 2020, the company has purchased a total of 129,218 BTC. The aggregate amount MicroStrategy spent in accumulating the Bitcoin was around $3.96 billion. Unfortunately, the recent Bitcoin crash has caused MicroStrategy a loss of $1B, at the time of writing.

Coindesk reports: “Michael Saylor’s MicroStrategy (MSTR) is sitting on an unrealized loss of more than $1 billion on its bitcoin (BTC) holdings as the price of the largest crypto touches $22,900 in Monday trading.”

Tesla’s Bitcoin Holding

Elon Musk’s Tesla was also not spared a massive Bitcoin dip. Aside from Dogecoin (DOGE), Musk has been a Bitcoin proponent, declaring support for the asset class on a few occasions.

At the time of writing this line, Tesla holds a total of 42,902 Bitcoin, which was acquired at an aggregate sum of $1.32 billion.

However, Bitcoin’s crash also plunged Tesla BTC’s holding value to $1 billion, thus implying that the American electric car company has lost a total of $320 million so far.

Despite the losses these corporate investors have incurred in recent times, they do not seem bothered, as it appears they are into Bitcoin for the long term.

El Salvador

Meanwhile, El Salvador is also having a rough ride with its Bitcoin investment. Following El Salvador’s Bitcoin adoption as a legal tender, the country has purchased a total of $2,301 BTC.

The aggregate amount of a unit of BTC owned by El Salvador was purchased at an aggregate price of $43,900, which implies that a total of 2,301 BTC was acquired at $101 million. With Bitcoin crashing to $23,465, El Salvador’s Bitcoin holding is worth approximately $54 million, which implies that the country is down $56 million.

Other Cryptocurrencies Dip Amid Rising Inflation

Meanwhile, the unfortunate development that befell Bitcoin is also noticed in other cryptocurrency projects, including Ethereum (ETH), Binance Coin (BNB), Cardano (ADA), Ripple (XRP), etc.

The cryptocurrency market reacted alongside other financial markets following reports of surging inflation in the United States.

With the Federal Reserve poised to mitigate rising inflation, cryptocurrency investors fear that more stringent measures will be implemented to make it a reality.

Bitcoin is currently trading around $23,465, down 13.3% in the last 24 hours, data on Coingecko shows.

More Selling Pressure On Ethereum As Large Defi Protocols May Sell $900 Million In ETH To Defend Their Positions

Albert Brown
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More Selling Pressure On Ethereum As Large Defi Protocols May Sell $900 Million In ETH To Defend Their Positions

 

Ethereum In The $1,100-$1,200 Range With $900 Million In Liquidation Pressure From DeFi Protocols.



While the larger crypto market stays red, Ethereum seems to be faced with an even more pressing issue.

ETH has been on a free fall over the last week, and now things seem to be on the brink of getting worse if one particular point is to be reached.

Various crypto analysts have made attempts at predicting what might happen if the ETH price falls below the $1,200 mark.

$900 Million To Be Liquidated To Settle Debts

The fall of ETH price can be attributed to various factors, including the usual ripple effects in the entire market as well as the whale action in DeFi protocols.

Apparently, whales have been selling off. One instance was reported on Twitter by PeckShieldAlert, who pointed out that close to 28,000 ETH worth 37.4 million has been sold off by MarkerDAO to settle debts.

 

Another 65,000 was sold for the same reason after the wETH/USDC pair fell to $941.

Celsius has transferred about 104,000 ETH to FTX in the past three days, as Celsius Network, which created the CEL token, has stopped all transfers, withdrawals, and swaps on its network.

Parsec.finance, reports that around $900 million will be liquidated if the ETH price falls between $1100 and $1200. This is due to the pressure in the DeFi space, especially affecting MarkerDAO, AAVE, and Compound to maintain their stability.

Ajibola Lawal, Investment Lead at Kaicho Capital says, “As Ether currently trades $1,221, down over 16%, It’s fifty-fifty that this cascade comes through. Because in the same way that we can see their liquidations, the players at risk can attempt to defend their positions. The challenge that they face is if the prevailing selling pressure blitzes right through their attempts.”

As it is right now, ETH appears to be approaching this breaking point. The coin is currently trading at around $1,221, leaving just a little space to hit the liquidation point. Basically, liquidation occurs when an exchange decides to close a trader’s position due to a loss of the initial margin.

At this point, the trader’s account doesn’t have enough funds to maintain the open position.

Is It A Bear Market?

Bearish sentiments have been flying all over the crypto space since the beginning of the year. The crypto space has experienced a pullback for the last few months.

As a matter of fact, there have been predictions to this effect, some coming from popular crypto market players like Peter Brandt. Peter Schiff also predicted that ETH can fall below $1000.

Terra Founder Do Kwon Accused Of Using a Mystery Wallet With 20 Million LUNA to Manipulate Terra’s Proposal Voting

Mark Brennan
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Terra Founder Do Kwon Accused Of Using a Mystery Wallet With 20 Million LUNA to Manipulate Terra’s Proposal Voting

The Terra CEO has come under yet another scrutiny for manipulating proposals’ voting using a mystery wallet. 


Do Kwon, the founder, and CEO of TerraForm Labs (TFL), has been under scrutiny since the unfortunate collapse of Terra ecosystem tokens, UST and LUNA.

Several reports have emerged, indicting Kwon of alleged corrupt practices, which contributed majorly to the collapse of the tokens.

Kwon Manipulating Terra Proposal Votes 

According to a recent revelation made by pseudonymous Terra whistleblower FatMan, Kwon broke TFL’s rules by using one of his secret wallets to vote on the firm’s proposal on Terra Station.

FatMan took to Twitter yesterday to make the shocking revelation, saying:

“Caught. The ‘mystery’ wallet with a 20M LUNA airdrop that was voting on Do’s own proposal, delegating to North Star, insider trading ASTRO, etc. – it is officially confirmed that it belongs to Do Kwon himself.”

 

FatMan proceeded to share a screenshot of a Twitter thread he had last month with Terra CEO, where he tried to enquire about the real identity of the owner of the wallet. However, Kwon refused to respond to the questions asked by FatMan at the time, as he said: “I decline to respond.”

FatMan further indicated that in August 2021 the same secret wallet was used by Kwon to submit a proposal with the title, “Columbus-5 Mainnet Upgrade Proposal and Recommendations.”

FatMan Shares More Proof

In a bid to further prove that the wallet was used by Kwon to vote on selected proposals, FatMan shared one of the proposals dubbed Col-5 Agora, in which the wallet was used to vote multiple times to ensure the proposal passed.

FatMan noted that the wallet is Kwon’s alternative wallet that has been used to vote on proposals.

Fattman further said that Kwon is only sucking the blood of the community and using terra followers as an instrument.

“They told you TFL doesn’t vote. They told you TFL didn’t get the drop. But you’ll notice that every tiny thing they do is extract more money out of the ‘community’ through wordplay and manipulation. He doesn’t care about you. You are an instrument to him and always were,” FatMan added.

Kwon Accused of Vote Rigging 

The development adds to the list of problems Kwon is currently facing. Recall that members of the Terra community called out Kwon for manipulating the voting exercise on the proposal to create a new chain and new LUNA tokens.

The Terra community stated that Kwon rigged the voting exercise because the proposal had already gotten a significant amount of votes before the link to the voting page was shared with the public.

Just In: TRON’s USDD Stablecoin Has Just Lost Its USD Peg, TRON DAO Injects $700M To Recover

Mark Brennan
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Just In: TRON’s USDD Stablecoin Has Just Lost Its USD Peg, TRON DAO Injects $700M To Recover

 

USDD has experienced a slight de-peg but TronDAO reserve will deploy $2 billion to support a re-peg.



The crypto market is opening the week on a bad footing. The markets are in the red. First, the Celsius network announced a stoppage of withdrawals and swaps due to extreme market conditions. Now, TRON’s USDD stablecoin has de-pegged from the USD. The markets are in the red.

News of the de-peg was broken on Twitter by Tron’s Justin Sun. Apparently, this disruption in the USDD market was brought about by a negative funding rate for TRX shorts on Binance which amounted to -500% APY. As a result, Tron’s algorithmic stablecoin, USDD, experienced a slight de-peg from the USD.

USDD has lost 1.5% of its value and is currently trading $0.9886

 

usdd charts

$2 Billion To Re-Peg

A stablecoin’s peg to the USD ensures a 1:1 ratio between the stablecoin and the USD, and this boosts liquidity in terms of cryptocurrency facilitated by the stablecoin as opposed to fiat. According to Justin Sun, the de-pegging of USDD from the USD doesn’t seem to be much of an extreme occurrence.

While announcing the de-peg, Sun opined that the condition will be resolved shortly and the de-peg won’t even last for 24 hours. He further intimated that Tron would use $2 billion in TronDao reserves to fight the Binance shorts fundings rates and facilitate the USDD re-peg.

$700 Million Already Injected

Justin Sun also sent out an update, saying that about $700 million worth of USDC has already been deployed as part of the $2 billion reserves set aside to support USDD. At the time of this writing, USDD is trading at $0.99. The coin seems to be recovering from the de-peg that had earlier taken it down to the $0.98 levels.

 

What’s With Algorithmic Stablecoins?

Tron’s USDD is an algorithmic stablecoin. These types of stablecoins have come under intense scrutiny of late after the collapse of Terra’s UST. However, it seems that on its part, TRON was prepared for emergencies and took action early enough to deploy the reserves to maintain the peg.

The Total Crypto Market Cap Drops 7%, Falls Below $1 Trillion For The First Time Since February 2021

Albert Brown
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The Total Crypto Market Cap Drops 7%, Falls Below $1 Trillion For The First Time Since February 2021

 

Crypto Market Is Falling and there is no relief in sight.


 

Over the course of the last weekend, the value of Bitcoin, Ethereum, and all of the other main cryptocurrencies continued their downward trend, wiping out the modest gains gained over the previous week.

The total value of all cryptocurrencies on the global market dipped below $1 trillion for the first time since February 2021, when it reached $998 billion.

total marketcap

The immediate cause of the drop in cryptocurrency prices seems to be a major sell-off by investors in response to heightened concerns about inflation. The fact that investors are continuing to avoid riskier assets is reflected not just in the bond markets but also in the stock markets.

It wasn’t limited to Bitcoin and Ethereum alone. Over the course of the last week, every single one of the top 20 currencies ranked by market cap has seen a decline of double-digit percentages.

Why Markets Are Dipping

The rising costs of food, gas, and energy are believed by some industry specialists to exert tremendous pressure on the cryptocurrency market. This theory is based on the fact that both Bitcoin and Ether have experienced losses in the double digits over the course of the last 24 hours.

After a tremendous bull run in 2020 and 2021, the crypto market has been unstable all year, but the current Crypto Winter started in May when major currencies plummeted with the stock market. 

Lately, tech stocks and crypto have dropped. Prices for consumer goods rose 8.6% year over year in May from May 2021, the highest rate of year over year inflation since 1981, which exacerbated the downward trend.

Another reason for the dip might be because most investors are worried that if inflation levels don’t start lowering soon, the US Federal Reserve may have to tighten controls by hiking interest rates at a quicker pace than they had expected. This is one of the reasons why the drop occurred. The crypto market is worth $998B at press time, a 7.35% drop in the last 24 hours.

Binance Declines Support for Litecoin (LTC) MimbleWimble Extension Block (MWEB) Update

Mark Brennan
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Binance Declines Support for Litecoin (LTC) MimbleWimble Extension Block (MWEB) Update

The world’s largest exchange believes criminals may widely use the feature to withdraw their ill-gotten funds. 


Due to security concerns, the world’s largest cryptocurrency exchange Binance has announced that it will not be supporting the deposits and withdrawals of Litecoin (LTC) utilizing the Mimblewimble Extensions Block (MWEB) function.

The largest cryptocurrency exchange by daily trade volume noted on Twitter today that LTC deposits made using the MWEB function will either be returned or not deposited in the receiver’s wallet because of the inability to verify the senders’ address.

 

Binance added that users may lose their funds if they use the MWEB function to transfer Litecoin from an external wallet to the exchange.

“To ensure the security of your funds, please do not deposit LTC through the MWEB function,” Binance said in a statement.

The development was also shared on Twitter by the popular cryptocurrency media outlet Wu Blockchain.

“Binance announced that it will not support the deposit and withdrawal of Litecoin through the MimbleWimble Extension Blocks (MWEB) function. Previously, the Korean exchange said that it would stop LTC trading because of MWEB’s anonymous function.”

Motive Behind the Move

The exchange has decided not to accept LTC transactions using the MWEB function due to the surging rate of criminal activities in the cryptocurrency space.

In recent times, there have been numerous incidents of crypto heists, running into millions of dollars. While hackers have been lucky in stealing unsuspecting victims’ funds, the issue these malefactors have faced has always been withdrawing the funds.

Binance fears that the feature launched by the Litecoin Foundation will be widely adopted by criminals looking for ways to withdraw their stolen funds.

South Korean Exchanges

Meanwhile, Binance is not the only exchange that has expressed concern about the new Litecoin feature. Since the initiative was launched, five Cryptocurrency exchange-based in South Korea, including Korbit, Coinone, Upbit, Bithumb, and Gopax, have noted that they may delist the coin from their trading platforms after the LTC’s MEWB update.

Litecoin MWEB

The Litecoin WimbleWimble Extension Block is an upgrade launched by the Litecoin Foundation with the aim of improving users’ privacy and scalability.

With this function, Litecoin users can send funds from their wallets to any address without including their own details, thus making transactions opaque.

according to Binance:

“The MWEB function allows users to send confidential LTC transactions without revealing any transaction information meaning that we’re unable to verify the sender’s address. To ensure the security of your funds, please do not deposit LTC through the MWEB function.”

1.04 Billion Shiba Inu Burned in 7 Days, While Shib Loses 25% Value in a Week

Zabi
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1.04 Billion Shiba Inu Burned in 7 Days, While Shib Loses 25% Value in a Week

 

1.04 Billion Shiba Inu (SHIB) Burned in the Past 7 Days, While Shiba Sheds 25% of Value in a Week.



Over 131.34 Million Shiba Inu (SHIB) burnt within the Past 24 Hours and 1.04 Billion in the Past 7 Days. 1,055 Bone ShibaSwap (BONE) has also been destroyed by one of the Community-led Burning Projects.

Despite these positive developments, Shiba Inu was unable to retain its critical support level located at $0.00000908 on the 4-hours chart and dipped towards the $0.000008 level, showing a decrease of over 4% in the past 24 hours. Shiba Inu lost 25% of its value in the past 7 days, CoinMarketCap reports.

Data from the tracking platform Shibburn shows that over 1.04 billion Shiba Inu have been incinerated since Monday. 1CENT, one of the tokens dedicated to burning SHIB, has also moved out 1,055 Bone ShibaSwap (BONE), the governance token of the Shiba Inu ecosystem from circulation forever.

Travis Johnson’s SHIB Super Store, ETH SHIBA, and 1Cent token are among the prominent SHIB Burn contributors of the Week. Travis Johnson’s SHIB Super Store was able to organize two back-to-back “Weekly Burn Events”.

According to the tweet posted by Shibburn, an overall 1,046,842,187 (1.04B) Shiba Inu dog-themed tokens have been moved to unspendable wallets in the past 7 days in merely 101 transactions.

Among prominent SHIB Burners, the Game Developer Travis Johnson’s Store burns the most Shiba Inu tokens in a week, whereas ETH SHIBA was the second big Shiba Inu burner, and 1Cent manages to occupy a third spot in the list.

Travis Johnson’s Super Store Weekly Burn Events:

Travis Johnson’s SHIB Super Store has organized two back-to-back “Weekly Burn Events” and was able to incinerate a total of 102 million Shiba Inu tokens via SHIB Burn Portal.

June 7th (Tuesday): Travis Johnson’s SHIB Super Store conducted a burn of 56,024,490 (56.02M), worth $592.

June 12th (Sunday): In the past 24 hours, 46,333,333 (46.33M) SHIB, worth were moved out of circulation forever by the individual SHIB Burn Project in one significant transaction.

The individual SHIB Burn Project has shared a Burn transaction link along with a few screenshots from SHIB Burn Portal with the community via tweet, as a “Proof of Burn”.

In this way, within the last 4 days, the SHIB Super Store project has burned a total of 102,357,823 (102.35M) SHIB, worth $1,010 in two separate transactions.

ETH SHIBA Weekly Burn Event:

ETH SHIBA, one of the tokens dedicated to burning Shiba Inu is recognized as the “Second Top SHIB Burner of the Week”.

On June 8th (Wednesday), the team behind the token organized its Weekly Burn Event through the SHIB Burn Portal. Through this event, the project has moved out a total of 90 million Shiba Inu tokens from circulation forever through one significant transaction.

The team shared “Proof of Burn” in the shape of an Etherscan transaction.

ETH SHIBA token is not an official token of the Shiba Inu Ecosystem. It came into existence at the end of March 2022. In three months period, the token has claimed to burn over 2.44 billion Shiba Inu tokens.

1CENT Weekly BURN EVENT:

1Cent, the only token dedicated to burning the other two of the tokens of the Shiba Inu ecosystem, i.e., SHIB and BONE, organized its Weekly Burn Event on June 6th (Monday). Through this event, the 1Cent token has destroyed a total of 84,331,326 (84.33M) SHIB, worth only $932 in one significant transaction.

At the same time, the project carried out another transaction and moved out a total of 1,055 Bone ShibaSwap (BONE), the governance token of the Shiba Inu ecosystem from circulation forever.

Soon after organizing the Weekly BURN EVENT, the team also updated the total number of Burn SHIB tokens and BONE on its official website. The SHIB Burn Project claims to burn a whopping total of 2,310,099,623 (2.31B) SHIB through 14 separate transactions since March 14th, 2022.

1Cent is the only project that burns not only SHIB but also BONE. The team burnt BONE for the first time on April 25th, 2022. Since then, 1CENT has permanently taken out 42,759 BONE tokens from circulation through 7 separate transactions.

Past 24-Hour Burn:

Besides weekly burns, a total of 131,348,227 (131.34M) SHIB tokens have been permanently removed from circulation by Shiba Inu Community through 11 separate transactions in the past 24 hours.

However, in the past few hours, the burn rate of SHIB dropped significantly, and by now it has decreased by -33.86% as a lot fewer SHIB tokens have been burned.

Impact on SHIB Price:

Despite massive burns being in play from the Community side, Shiba Inu’s price continues to shed its value on a weekly basis. The price of Shiba Inu loses more than 25% of its value in the last 7 days as the dog-themed cryptocurrency was unable to retain its recent support located at $0.00000908 on the 4-hours chart. Following the breakout, Shiba Inu dipped towards the $0.0000080 level while shedding over 4% of its value in the past 24 hours.

At the time of writing, Shiba Inu is trading at the price of $0.000008430, with a 24-hour trading volume of $484,060,890 ($484.06M).

Ethereum In Oversold Territory As Weekly RSI At Its Lowest Point Since 2018, Is Some Relief Coming?

Mark Brennan
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Ethereum In Oversold Territory As Weekly RSI At Its Lowest Point Since 2018, Is Some Relief Coming?

 

Ethereum Weekly RSI Is At Its Lowest Point Since 2018.



The crypto market is bleeding, and even top coins like ETH are no exception. It appears that the bears have been very persistent over the last few days. Merely a week ago, ETH was trading at just over $1,900. Today, crypto is valued at around $1,325 (as of the time of this writing). Things don’t seem to be going well for the entire market.

Lowest RSI In Almost 4 Years

Meanwhile, ETH is experiencing a big decrease in its market standings as well as growing pains among investors.

In fact, a Twitter update by a popular crypto trader and analyst shows that the coin’s RSI (Relative Strength Index) has decreased to the lowest point since December 2018. The referenced point in late 2018 marked the bottom of the previous bear cycle. If the RSI drops below that level, it will be ETH’s lowest RSI point ever.

 

The coin has spent a bloody weekend, and it’s not clear whether the downward movement will be halted in the course of the week. On the other hand, there have been numerous claims that the entire market is entering a new crypto winter. That’s not good news for ETH at this point.

According to Poppe majority still wants to short but weekly RSI hitting at the lowest point, which might bring some relief rally for the world’s second top coin in the coming days as ETH weekly RSI enters the oversold territory after 2018.

ETH Addresses In Loss

According to a report by Glassnode, the number of ETH addresses current in the loss zone has reached around 36.7 million. This is the highest number ever.

Bearish Prediction: Peter Schiff says ETH To Drop To $1k

As ETH price drops to weekly lows and the entire market gives in to the bears, anti-crypto characters are happy to let everyone know that Gold is a better investment.

One of these people is Peter Schiff who owns a gold-selling and custodial business. In a tweet, Peter claims that the ETH price could drop all the way to $1,000 and that the entire crypto market will soon lose $800 billion in market cap. He went on to advise people not to buy the dip.

However, Peter Schiff and other anti-crypto entities like Warren Buffet have been strongly opposed to crypto investments for years. They don’t seem to soften their stand even when the prices soar.

Cardano Introduces Ethereum Virtual Machine (EVM) Sidechain Alpha on Testnet 

Lele Jima
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0
Cardano Introduces Ethereum Virtual Machine (EVM) Sidechain Alpha on Testnet 

The team behind the popular blockchain project has launched another significant feature for its users. 


The Cardano team is not slowing down anytime soon with continuous development in its quest to make the blockchain rank among the top Layer-1 networks.

In a recent announcement, Input Output Global (IOG), the organization in charge of research and development of Cardano, noted that it has launched a permissionless Ethereum Virtual Machine (EVM) sidechain Alpha on testnet.

According to IOG, the initiative will enable developers to build different solidity-based applications on the Cardano network, as well as import their solidity apps from Ethereum to Cardano.

“We’re releasing the Ethereum Virtual Machine (EVM) sidechain alpha! (Now on testnet.) Build your Solidity-based applications on Cardano – a decentralized, permissionless, sustainable blockchain. The future is interoperable,” the IOG tweeted a couple of hours ago.

IOG Teases About EVM Sidechain

Although it is not clear when the Cardano team will launch the EVM sidechain on the mainnet, it is expected that after rigorous testing, the IOG will schedule a date for a full roll out.

Meanwhile, the move to roll out the EVM sidechain was first discussed in April of this year, when the IOG published a blog post titled “Interoperability is key to blockchain growth.”

In the blog post, the EVM sidechain as well as five other Cardano sidechains were discussed.

“IOG is planning to release a new permissionless EVM sidechain this year. This sidechain will allow developers to write Solidity smart contracts on Cardano, create EVM compatible dApps, and ERC20-compatible tokens (and in time, their own sidechains) while gaining many of the benefits of Cardano,” an excerpt of the blog post reads.

IOG noted that users will benefit from faster settlements and lower fees on the sustainable blockchain.

Furthermore, the EVM sidechains will be compatible with Ethereum tools and upgrades, Web 3.0 wallets, Ouroboros consensus protocol, and the maximum security inherent in the Cardano mainchain.

A few days ago, the IOG team shared detailed steps that will help solidity developers gain early access to the EVM sidechain.

IOG Consistent in Releasing Upgrades

The Cardano team has always been consistent in releasing useful upgrades and features. At the moment, Cardano enthusiasts are eager for the implementation of the Vasil Hard Fork, an upgrade tipped to bolster the performance of the entire network, especially the smart contract functionality.

It is noteworthy that the Vasil Hard Fork Event is scheduled for later this month.

Celsius Sharp Fall, Team Transfers $320M Worth Of BTC And ETH To Exchanges, Is This Turning Into Terra Like Disaster?

Albert Brown
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Celsius Sharp Fall, Team Transfers $320M Worth Of BTC And ETH To Exchanges, Is This Turning Into Terra Like Disaster?

 

Celsius Has Paused All Withdrawals, Swaps, And Transfers Citing Bad Market Conditions – Is It Turning Into Another Terra Luna Disaster?



Weeks after the collapse of Terra, the crypto market is yet to recover from the shock. Now, another ecosystem seems to be struggling and investors are worried that it may be heading the Terra way. The Celsius Network, which created the CEL token, has stopped all transfers, withdrawals, and swaps on its network.

In a post on its blog, the company announced the stoppage of account operations, Paused All Withdrawals, Swaps, And Transfers citing unfavorable market conditions. It also sent out emails to customers. It said that the action was meant to protect its customers’ funds as it finds a way to solve the problem. However, investors will still continue to earn rewards from their investments.

Transferred Thousands Of ETH And BTC – Is This A Rug Pull?

While Celsius has stopped investors from withdrawing or swapping their assets, reports have emerged that the company has been transferring lots of ETH to exchanges like FTX.

According to Wu Blockchain:

“Celsius has transferred about 104,000 ETH to FTX in the past three days, including about 50,000 ETH today, 12,000 ETH yesterday, and 42,000 ETH the day before yesterday. In addition, Celsius also transferred about 9,500 WBTC to FTX today.”

The worth of the above transfers is appx $320,000,000 ($320M).

Apparently, the company has been making the transfers for the last few days. Did they anticipate the crash? In the case of Terra Luna, the company involved, TFL, is said to have transferred funds to secret accounts months before the Terra crash.

This is why Celsius’ transfer of thousands of ETH to FTX doesn’t sit well with a lot of people. Could this be another rug pull just like Luna and UST?

On its part, Celsius claims to be doing everything it can to protect investors and find a way out of the predicament. Time will tell.

“We are taking this necessary action for the benefit of our entire community in order to stabilize liquidity and operations while we take steps to preserve and protect assets. Furthermore, customers will continue to accrue rewards during the pause in line with our commitment to our customers.”

CEL Is Crashing

Meanwhile, CEL is crashing hard. The token has lost over 53% of its value over the last 24 hours and now trades at around $0.19, down from $0.49 on the previous day. The market cap has also dropped by close to 48%, reaching the lows of $137.8 million. The current price is far from CEL’s ATH of $8.02 merely a year ago on June 3rd, 2021. It now records a 97.5% drawback.

Company Downplayed Terra Effects

Celsius is one of the high-yield tokens in the market, offering as high as 30% returns on investment (ROI). Experts have attributed these kinds of extremely high yields to the collapse of Terra which was offering up to 20%.

However, a few days ago, Celsius downplayed the effects of the high yields, saying that it had re-designed its working procedures to avoid the pitfalls experienced by Terra. Now, it appears that the issues have caught up with it.

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