Celsius Engaged in an Unregistered Securities Offering, Alleged Vermont’s Financial Regulator

A US state has launched an investigation into the company. The Department of Financial Regulation (DFR), a US state, has made serious allegations against the crypto lender.

Vermont Watchdog Statement on Celsius

The DFR stated that it believes Celsius to be “deeply insolvent”, and that the firm doesn’t have the assets or liquidity to fulfill its obligations to other creditors and account holders.

DFR claimed that Celsius Network had been operating in several jurisdictions, including Vermont. It also claimed that the firm was offering unregistered securities to retail investors. The DFR also noted that Celsius Network does not hold a money transmitter license, and may have been operating largely unregulated.

The Department announced that it would be joining forces with other states to investigate Celsius. The Department also pointed out that Celsius’s CEO and claims about customer funds safety, as well as the ability of the lender to meet withdrawal obligations, are false.

Celsius stopped all customer account withdrawals, swaps and transfers in June. The lender fired 150 employees as it struggled with the financial crisis. In an effort to preserve and protect its assets, it hired Alvarez & Marsal’s restructuring consultants.

“Celsius has not provided sufficient or complete information to investors to allow them to make informed purchases and sell CEL. CEL tokens can be worthless or their value will drop sharply if investors purchase them. State and federal laws may be violated if concerted efforts are made to manipulate the CEL price.

Celsius has not been transparent and has chosen to keep its financial records secret in order to avoid bankruptcy. The lender lost $6 billion in liquidity assistance to potential investors due to its refusal of disclosing its financial records.

A report by Arkham Intelligence, a blockchain analytics company, suggested that Celsius could have used client funds for high-risk, leveraged crypto trading strategies.

Hotbed Crypto Lenders

Apart from Celsius Network, many crypto lenders, such as Voyager Digital have been in financial turmoil.

The Department of Financial Protection and Innovation of California (DFPI), is currently investigating multiple companies offering “interest-bearing cryptocurrency-asset accounts” customer offerings. These could not have adequately disclosed the risks customers face when they place crypto assets onto their platforms.

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Marla Brooks

Marla Brooks – Financial Analysis My name is Marla Brooks, and I am the mainstream behind the”observednews.com”  for the powerful and most delicate insights into the latest activities in the financial analysis category. I started my journey as an independent financial consultant. I had approximately nine years of experience in this field. I am free soul so; my passion for exploring the world has taken me to the nations across the globe and given me the chance to report for a portion of the best news associations. Currently, I am a full-time editor as experienced in finance and started to use my abilities.

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