Celsius Network announced that it had implemented a pause on withdrawals, exchanges and transfers between accounts in a notice sent out Monday morning. The company attributed the problem to "extreme market conditions".
Following the release of CPI inflation data by the US Department of Labor last Friday, cryptocurrency markets are in freefall. Market cap outflows since then totaled $213 billion from peak to trough. US consumer inflation hit a 40-year high of 8,6% in May, up 0,3% from the previous month, which indicates that inflation and the associated cost-of-living crisis are not under control. The Celsius warning is yet another sign of macroeconomic conditions putting pressure on an already tense cryptocurrency industry.
Celsius takes steps to stabilize its operations
In response to the pressures, Celsius said the move would put her in a better position to honor her long-term obligations. The company added that it was necessary to “stabilize liquidity and operations”. However, the notice confirmed that the rewards would continue to accumulate during the break period.
“Acting in the interest of our community is our top priority. In service of that commitment and to adhere to our risk management framework, we have activated a clause in our Terms of Use that will allow this process to take place.”
The event triggered a 74% swing to the downside of the CEL token. Support reached the $0,0930 level, triggering an initial fight from the bulls. But most hourly candles since then indicate indecision. In May, some Celsius users reported difficulties in withdrawing funds, which sparked rumors that the company was insolvent. Commenting on this in a statement sent to CryptoSlate on June 3, Celsius said he has no problem fulfilling withdrawal requests and honors them as quickly as possible. Any withdrawal delays that occurred were due to issues beyond your control. The company works with affected customers to resolve the issue in these cases.
