Another Crypto Value Destruction Day

By Paul Ausick Published Jun 13, 9:11AM EDT

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Another Crypto Value Destruction Day — © 136770128@N07 / Flickr

Premarket trading Monday had the three top U.S. equity indexes picking up where they left off on Friday afternoon. All three traded lower, but only by about half as much as their closing prices Friday.

The cryptocurrency markets are a different story. Bitcoin (BTC) was trading down almost 14% at around $23,600, ethereum was down 18.2% at just under $1,200, and Binance Coin (BNB) was down about 14.6% at $220. These prices reflect declines over the past 24 hours. Recall that crypto markets never sleep.

Of the 10 largest (by market cap) cryptocurrencies, only Binance USD and USD Coin, both stablecoins, were trading higher. By less than 0.1% in both cases.

Last Friday’s consumer price index report sank crypto prices just as it sank equities prices. Then, late Sunday, crypto lending service Celsius announced on its blog that it is temporarily halting all withdrawals, swaps, and transfers between accounts due to “extreme market conditions.” The company took this step in order “to put Celsius in a better position to honor, over time, its withdrawal obligations.”
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Celsius operates like a consumer bank, taking deposits from some customers, lending to others and profiting from the difference in the interest rate it pays the former and that it collects from the latter. The big difference is that it does not have federal deposit insurance, and any crypto assets it claims are subject to crypto price movements.

Colin Wu (@WuBlockchain) has been watching Celsius’s movements:

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Wrapped Bitcoin (WBTC) trades at around $23,600, slightly lower than Bitcoin itself.

A Celsius rival, Switzerland-based Nexo, is riding to the rescue, at least of Celsius’s investors:

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Nexo has offered to acquire some Celsius assets, “mainly collateralized loan receivables secured by corresponding collateral assets, brand assets and customer database.” The offer is good for one week, with the sale price still to be negotiated.

The Celsius platform’s token, known as CEL, dropped by 70%, from $0.49 to $0.15, in the first hour following the company’s announced pause in withdrawals. According to CoinMarketCap, CEL traded at around $0.217 early Monday morning.
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Here is CEL’s chart for the past 24 hours.

About the Author Paul Ausick →

Paul Ausick has been writing for a673b.bigscoots-temp.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.

He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.