Nexo proposes Celsius buyout after withdrawal halt

Celsius, a cryptocurrency lending platform, announced on Sunday that it would freeze all customer withdrawals, swaps, and transfers on its platform, citing market conditions as the entire crypto world is in turmoil. It did not specify when the withdrawals would be resumed.

According to CoinMarketCap, the company's CEL token plunged 70% in one hour, from a high of $0.49 earlier on Sunday to $0.15.

"We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations," Celsius revealed. Celsius also published a blog post explaining how it was working to resolve the situation.

Celsius banned new transfers from unaccredited investors on its U.S. platform from earning rewards in April as the firm was facing several legal investigations from regulators in multiple U.S. states over allegations that its lending and earning programes might be in violation of securities laws.

Celsius is basically a blockchain firm with over 1.7 million customers worldwide that allows people to earn interest on their cryptocurrency assets. Nexo, a competitor with a similar business strategy to Celsius, has over 4 million global customers and offers services such as deposits, Visa cards, and earn features.

As markets go deeper into the bearish trend, Nexo's native token NEXO has dropped by 25% over the past few days.

However, Digital asset manager Nexo responded to the news of Celsius's pausing withdrawal announcement by proposing an acquisition of certain of the firm's liquid assets.

Nexo took to Twitter on Monday morning to post a letter of intent expressing its interest in acquiring some remaining qualifying assets, primarily collateralized loan receivables secured by corresponding collateral assets, brand assets, and the company's customer database.

The tweet said: "Nexo is in а solid liquidity and equity position to readily acquire any remaining qualifying assets of Celsius, mainly their collateralized loan portfolio. We are putting together an offer to Celsius to that accord and will communicate it publicly,"

According to Nexo, the offer will be valid for one week, until 4:30 a.m. UTC on June 20, 2022, unless Celsius accepts or rejects it or if withdrawn before that time.

At the moment, Celsius has a lot on its plate. There have been rumours that Celsius is insolvent, and conjecture about the company's financial problems began long before the company paused withdrawals. Mike Dudas, the former CEO of The Block Crypto news publication, tweeted about the "demise of Celsius" a few days ago, which offended the CEO of Celsius, Alex Mashinsk, who responded by requesting Dudas not to promote FUD and misinformation.

While everyone is panicking over the debacle, there are rumours that roughly $500 million of Celsius' funds have been locked within the Maker protocol as leverage. Moreover, Larry Cermak, vice president of research at The Block Crypto, totaled up a database of Celsius wallets and calculated that $1.5 billion is held in the accounts.

According to social media rumors, Celsius has unstaked $247 million in Wrapped Bitcoin from AAVE and transferred it to the FTX exchange.

These developments and speculations surrounding Celsius are enough to put the company under strain, and it wouldn't be the worst time for it to consider Nexto's buyout proposal. However, the company has yet to respond to the idea. There have also been analogies made on social media between Luna's collapse and Celsius' apparent insolvency.

Binance has paused withdrawals on its platform and resumed later

Due to "blocked on-chain transaction," the world's largest crypto exchange by trading volume has halted withdrawals on the platform. Though CEO CZ stated that the problem would be resolved in 30 minutes, it took several hours to resolve.
The issue only affected the bitcoin network, and customers could withdraw their funds via Binance's own BNB network or the Ethereum chain.
According to a blog post on the company's website, the transactions became blocked because they were submitted to the exchange with "low transaction fees," resulting in a backlog of Bitcoin withdrawals.

Binance has temporarily paused #Bitcoin withdrawals on the $BTC network. Meanwhile, you can still withdraw BTC on other networks.

This is due to a stuck on-chain transaction. Our team is currently working on a solution and will provide further updates soon.

— Binance (@binance) June 13, 2022

Terra's LUNA and UST withdrawals were put on hold last month after both coins fell due to the de-pegging of Terra's UST stablecoin. Trading in both coins was suspended for three days before it was reopened.
The announcement came after Celsius announced on Sunday night that it was banning withdrawals, causing a further drop in crypto values, with bitcoin (BTC) trading below $24,000 on Monday morning.
The crash saw the total market capitalization of all cryptocurrencies fall below $1 trillion, and Bitcoin had reached the lowest levels not seen since 2020.

Bank of America Survey Shows 91 percent of respondents want to buy crypto

Despite the dramatic drop in cryptocurrency prices, consumer interest in the sector remains high, according to research released by Bank of America (BAC) on Monday.
The bank surveyed 1,000 current and potential users of cryptocurrencies and digital asset exchanges. It was observed that 91 per cent of respondents planned to purchase cryptocurrency in the next six months, the same percentage as those who claimed they had purchased in the previous six months.
Expectations for selling are also stable, with 30% stating they will not sell any of their crypto holdings in the next six months.

According to BofA, there is increased interest in using cryptocurrency as a payment mechanism. Thirty-nine per cent have used  Crypto as a payment mechanism for online purchases and Thirty-four per cent for in-person, respectively.
According to the poll, crypto made up less than 10% of respondents' overall financial investments. However, allocations varied, with 15% owning more than 25% of their total financial investments in digital assets.