Celsius Investigation Reveals Red Flags Missed by Investors
A comprehensive 476-page report filed by court-appointed examiner Shoba Pillay details significant misconduct and missed warning signs in the collapse of crypto lender Celsius Network. The investigation, based on 500 gigabytes of data, reveals that Celsius executives allegedly misled investors and customers to prop up the company's proprietary token, CEL. Key findings include falsified initial coin offering figures, where the company claimed to raise $50 million but only secured $32 million, and market manipulation tactics to inflate CEL's price. Internal communications show employees discussing the token as worthless while publicly promoting it. Despite raising $741 million from venture capital firms and pension plans, Celsius lacked robust risk management policies until late in its operation. The report highlights how executives used customer deposits and equity funds to support the token's value before cashing out. This scrutiny comes as customers attempt to recover $4.7 billion in lost deposits following the company's Chapter 11 bankruptcy filing, triggered by exposures to Terra, Three Arrows Capital, and FTX.
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Celsius Investigation Reveals Red Flags Missed by Investors
A comprehensive 476-page report filed by court-appointed examiner Shoba Pillay details significant misconduct and missed warning signs in the collapse of crypto lender Celsius Network. The investigation, based on 500 gigabytes of data, reveals that Celsius executives allegedly misled investors and customers to prop up the company's proprietary token, CEL. Key findings include falsified initial coin offering figures, where the company claimed to raise $50 million but only secured $32 million, and market manipulation tactics to inflate CEL's price. Internal communications show employees discussing the token as worthless while publicly promoting it. Despite raising $741 million from venture capital firms and pension plans, Celsius lacked robust risk management policies until late in its operation. The report highlights how executives used customer deposits and equity funds to support the token's value before cashing out. This scrutiny comes as customers attempt to recover $4.7 billion in lost deposits following the company's Chapter 11 bankruptcy filing, triggered by exposures to Terra, Three Arrows Capital, and FTX.
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