Alex mashinsky, i hope i'm pronouncing that right, founder and ceo of celsius network, the person who people are not that fond of at the moment. So if you don't know about celsius, it's basically a crypto bank, i say basically a crypto bank, because if you ask alex he hates banks - and he says we're not a bank and normal banking rules shouldn't apply to us, but it's basically a bank. You can store your money there and you get paid interest very good interest and that's going to come into effect in just one second in this discussion, but you can even get loans and it's a bank. It's a crypto bank.

They say it's not a bank, but it's a crypto bank. The only reason they say: they're, not a bank is because they don't want to go with normal crypto rules and you get to wear these fancy. Schmancy shirts. That say, i hate banks, but in reality, okay, we're it's a crypto bank for the point of this discussion and just also reality well recently, withdrawals swaps and transfers between accounts are currently paused.

This is not good. It's basically saying: hey you go to your bank and you're like i want money and they're, saying no, no, no and you're like, but why and you're like we're, not giving you your money, that's what's going on with celsius right now, people cannot get their money they've! Literally stopped withdrawals, swaps and transfers, which rightfully so that would piss a lot of people off. So what happened? How did this bank get to the situation where people are now freaking out? Well, it's a little bit twofold. Remember.

The story we were talking about. Ethereum ethereum is attempting good to go through emerge or proof of work to proof of stake and they keep delaying it and this delay it's important for a lot of people who are part of the ethereum community, ethereum supporters also people who have st eth state eth. That's a big deal because you can't un-stake until the merge officially goes through and actually a little bit more than that. Just so you know, celsius has a ton of money state, so they can't do it technically.

They have that money, but they can't really use it. So that's important, but then also remember this: the fall of terra, a timeline of the meteoric rise and crash of ust and luna well turns out celsius had a cool, half billy involved in the anchor protocol. So, okay, that was a big loss for them and then a lot of their other money. It's tied up just through the staked eth crypto lending service celsius, pauses withdrawals, citing extreme market conditions.

So here is the skinny on the situation. Obviously we're in a crypto winter things are selling down and down and down, and it's not that hard look what's happening to bitcoin. Look what's happening to east look what's happening really to all of it. Like just look at coin market cap, look at crypto coins.

Look at coin 360., it's been going down down down bitcoin's, currently trading at 22., as people are going down, they get scared like dude. Maybe we shouldn't do this anymore, so people come over to celsius and they say okay cool. I need my money back out. Thank you for the interest rates uh, but, like i'm, a little scared right now with celsius people on the outside, who didn't really trust it they're, like celsius, has been giving away very good interest rates.

I mean if you look at their website, they're boasting a 17 18 apy. Well, if you go to your bank they're, basically like can you name your smallest number above zero and the bank's like sick cool? That's what we'll give you! They were always saying. Hang on there was this theoretical argument of like you're, giving away too much money. The interest payments are too good and granted the loaning rates are high, so yeah that was balancing it out a little bit.

But people always said if things get bad and there's basically like a digital bank run, are you going to have the liquidity and then people started to withdraw and then because they were withdrawing, there was more withdrawing and then the crypto was selling off. So people got scared, so they started to withdraw more and we started to find out that. Yes, there was a liquidity issue to the point that the native token 4 celsius right here cell celsius - token um - i mean look at this - i mean i think the picture tells you itself it's from four dollars, all the way down to 40 cents. Most recently went from 75 cents all the way down to 9 cents.

This is the native token that kind of keeps the engine running between like loaning distribution and all the stuff. It's just kind of really the oil in the system for the celsius bank, which is apparently not a bank that started going down and then because that was going down, there was even more of a run and, as you can see, it was a snowball effect in A very, very negative, bad bad situation. Now, everyone's like okay, we know you're having clearly a liquidity issue and you're doing things to try to help it, but then that's making it more obvious that you have a liquidity issue, making your liquidity issue even worse. But then the question is about the liquidity issue is: are they going to have solvency problems? Aka is celsius going to become insolvent in real time they haven't.

I hope they don't and not, because i think they're a good company, but i know a lot of people have their hard-earned money there and i don't like seeing people lose their money, but there is a chance that they become insolvent and then also on top of That it comes down to similar to what we've kind of recently seen in coinbase 10 qs of what happens in bankruptcy in their earns program. Their earned rewards that is subject to bankruptcy, as in the people could still lose it. So once it comes back to not your keys, not your coin, i know you can earn the interest payments and maybe that's the balancing act of like your money working for you, but the safest way to do this is taking all of your crypto off and storing It for yourself, your keys, your coin anyway, back to the solvency issue, there's been some interesting. Twitter accounts mainly dirty bubble.

Media credit is due there uh noticing that celsius is actually using some of its funds to like moving it around to try to save. What's going on here, especially because it has so much staked ease and recently it looks like ftx - is actually stepping in to try to help the situation celsius. Exodus 320 million in crypto sent to ftx users, withdrawals pause, so the money going to fdx - and this might be like we don't have. The exact numbers of it.

Celsius has been moving more than a quarter of a billion dollars worth of funds into the ftx exchange. For reasons not specified, in addition to suspending withdrawals for users, this might be some sort of collateral alone, maybe just backing the stake ether. Something like that. It sucks when you can't get your money right away, but even that's still better than never getting it so they're.

Like hang on, let's make a play now, so people get it, maybe just in an extended period, opposed to never at all type of a deal. Maybe this is all conjecture fdx becoming a custodian, maybe ftx giving celsius a loan to just try to keep sell alive. To try to keep the bank alive there's a lot of unknowns right now. It's not the fairest comparison to say like luna and ust kind of different, because this isn't a stable coin.

This is a bank that just has liquidity issues right now and it seems like they're doing everything in their power to not make it an actual solvency issue, but this is happening in real time. So obviously, as it develops more and more i'll, let you know but overall, if you want to be the most careful with crypto, you would take it off exchange away from brokers, and you would sort yourself your keys. Your crypto.