Celsius asks users for more time to enable withdrawals, but until when?


  • Celsius Network, a crypto lending firm on the verge of collapse, has requested that users give it more time to fix liquidity and operations.
  • Celsius settles a $10 million repayment to Compound Finance in an attempt to undo the damage caused.
  • Simon Dixon, the founder of BnkToTheFuture, has proposed a recovery strategy similar to that provided to Bitfinex following its Bitcoin hack in August 2016.

The recent months have been extremely unkind to cryptocurrency investors and the crypto industry as a whole. The present crypto winter is a long, dark night filled with terrors. The Celsius Network, an embattled crypto lending firm, has piled on to the misery already faced by the cryptocurrency sector.

The lending network has halted swaps, transfers, and withdrawals for the past eight days owing to extreme market conditions. This occurred as the cryptocurrency market was experiencing a steep decline, with Bitcoin plummeting to $17,000-level lows.

Celsius Network’s situation continues to frustrate investors

The financial chaos had been roving worldwide for months due to regulatory concerns. However, Terra Luna’s and UST’s failures exposed crypto fragility. The aftermath of this collapse shook the crypto market to its foundations. However, Celsius Network halted Swaps, Transfer, and Withdrawal before the dust settled due to extreme market conditions.

Investors are enraged by unanswered questions; How will I recover my money? When will Celsius withdrawals resume? Will the crypto market collapse if I don’t take action? After investing generously and staunchly supporting the crypto lender’s motto, “Unbank Yourself,” investors feel deceived and exploited.

When Celsius banned withdrawals, it sparked a firestorm among crypto community members because investors were afraid they would suffer the same fate as LUNA/UST. Notably, in May 2022, UST experienced a significant lurch that resulted in investors losing over 99% of their assets and savings.

I tried to reach them for days. You can’t remove someone’s ability to resolve a situation and then punish them for not resolving it I trusted them with my savings, and it’s unfair.

Affected investor

In the past year, cryptocurrencies have given retail investors the ability to build their fortune on what appeared to many of them to be a once-in-a-lifetime money-making opportunity. Now, as the tide is retreating for risk assets with cryptocurrencies experiencing especially severe declines, investors are reconsidering their trust in certain cryptocurrency companies, including Celsius Network.

At the start of May, according to its website, Celsius had 1.7 million users and $12 billion in client funds, the majority of which were retail. Moreover, Celsius has provided little assurance of its long-term financial stability, leading customers and spectators alike to question whether it is “risking bankruptcy.”

Celsius has employed bankruptcy lawyers and bankers from Citigroup. Meanwhile, some of its clients are joining the effort to sue Celsius. While smaller investors have a lesser probability of recovering their funds in a Celsius bankruptcy scenario, small claims court may offer financial recompense.

Following the network’s decision, securities regulators in five states (Texas, Alabama, Kentucky, New Jersey, and Washington) have designated it a “top priority” to investigate the crypto lender. Celsius Network is taking steps toward redemption and possibly atonement as more legal actions approach.

When will Celsius allow withdrawals?

In the wake of this news, Celsius Network has revealed that it will take time to put the recovery plan into effect since the overall cryptocurrency market is still recovering from a massive sell-off. There’s currently no official information on what will happen next for the community from the team, and everyone appears to be in the dark and making assumptions.

Celsius has sent $10 million worth of the DAI stablecoin to Compound Finance, a well-known interest-yielding DeFi service. According to the Etherscan block explorer, 10 million DAI was repaid while also collecting $166 in COMP ($5,200). Celsius has made numerous repayments in recent days as well. It transferred $42 million in DAI to its vault with Oasis Protocol, another yield-bearing DeFi platform. 

Celsius uses a variety of DeFi systems to create interest for its clients. Its latest $10 million payment suggests it is closing positions with those services to regain liquidity and re-open withdrawals for its customers. Though today’s $10 million payment is unlikely to solve the company’s problems, it represents just a tiny piece of its overall volume.

In reality, today’s transaction was only moments after Celsius provided an update and confirmed the suspension would continue. Celsius announced that it would put a halt to Twitter spaces and AMAs in order to provide further attention to the current situation.

However, Celsius’s investors appear to be becoming increasingly dissatisfied with the company’s course of conduct. Users on social media are attempting to stage a short squeeze to artificially inflate prices and profit from the brief period that such an event might provide.

Celsius has also urged users to give it more time to shore up liquidity and operations as the firm continues to struggle. Celsius’s value has been reduced by a combination of events that have put the company on the verge of bankruptcy.

It has been one week since we paused withdrawals, Swap, and transfers. We want our community to know that our objective continues to be stabilizing our liquidity and operations. This process will take time.

Celsius Network

The recovery plan

Simon Dixon, Celsius’ principal investor and co-founder has pledged to assist the network by leveraging the same “financial innovation” that saved cryptocurrency exchange Bitfinex from bankruptcy in 2016.

Dixon plans to use the exact solutions his company used in August 2016, after Bitfinex announced it lost approximately 120,000 Bitcoin (BTC) in a cybersecurity breach. This caused a loss of around $72 million of customers’ funds at the time.

Instead of going through bankruptcy, Bitfinex devised a novel recovery strategy in which customers would receive “promises to repay” in the form of BFX tokens, representing the value of the money lost in the hack.

These coins were tradeable on the open market or kept for future repayment of $1.00 per token, allowing investors to gamble on the firm’s success. At month-end, BnkToTheFuture extended the solution by collaborating with Bitfinex to enable customers to convert their BFX tokens into equity in the company.

At the end of seven months, BnkToTheFuture wrote that the strategy was working, with victims recovering between 75 percent and 100 percent of their money through various measures open to them.


Mr. Dixon was ambiguous on whether his recovery plan would function the same way with a token, but he did say that it would be addressed using cutting-edge technologies. The recovery strategy has not been detailed, and investors are unable to withdraw their funds. Only time will allow these concerns to subside.

Share link:

Florence Muchai

Florence is a crypto enthusiast and writer who loves to travel. As a digital nomad, she explores the transformative power of blockchain technology. Her writing reflects the limitless possibilities for humanity to connect and grow.

Most read

Loading Most Read articles...

Stay on top of crypto news, get daily updates in your inbox

Related News

Vodafone to Merge Crypto Wallets with SIM Cards
Subscribe to CryptoPolitan