Infamous for one of the largest crypto frauds to happen in recent memory, the trading platform Celsius was one of the biggest players in the game. Before filing for bankruptcy and permanently withholding withdrawals for all of their clients, the firm had total assets equaling $4.7 billion.
However, if the fact that people who were using the service to trade different assets and suddenly lose access to those funds weren’t bad enough, the bankruptcy was clearly planned. According to financial disclosures that the company filed during its bankruptcy hearing, three executives cashed out nearly $40 million stopping their clients from making withdrawals.
Continued Investigations
Three executives at three major roles of the company pulled out a collective $40 million. These three individuals included Nuke Goldstein, the CTO, Daniel Leon, the CSO, and Alex Mashinsky, the CEO. Mashinsky and Leon have both resigned from their respective positions, with Leon having only resigned recently.
As for Mashinsky, he resigned much earlier, in September to be exact, but is still the major suspect in several investigations against the firm. Various authorities are looking into a firm that went belly up despite having users with investments totaling $4.7 billion.
They are specifically looking into if the company started out as a Ponzi scheme, or if was it a company hit with seriously bad luck. As of now, 40 other states are also looking into the possibility that the company could have been trying to separate its clients from their hard-earned cash.
A Board of Bad Actors
According to various court documents that the three individuals have filed, it appears that they all withdrew money before clients could catch wind of what was going on. The CEO got away with $10 million, with the CTO and CSO both getting over $20 million and $11 million.
While the sources who provided this information still remain unknown, it has become obvious that Leon and Godstein tried their best to make sure that people wouldn’t know that the Celsius Token had liquidity issues.
A Market Still in Turmoil
Despite the Celsius crash happening months ago, it still obviously has a major effect on the entire industry, as nearly every major company has struggled with the recent interest rate hikes and the rampantly deteriorating global currency market. Therefore, Bitcoin is still struggling to recover to its previous years’ glory, as prices dropped by 63%.
The other very popular cryptocurrency is Ether, which lost 62% over the past year. As for Celsius tokens, they saw a rapid decline of 78%, leaving the price of the coin down to $1.28. And as the market continues to fall, it is very likely that investors will be less likely to invest in cryptocurrencies.