Crypto lender Celsius has cleared its intention now because it utterly repaid its Aave mortgage, and the Maker mortgage final week. The outstanding debt has now been lowered to virtually $50 million. Celsius might be probably seeking to repay its excellent Compound mortgage and extra token liquidations this week. The crypto lender has additionally withdrawn stETH value $416 million from the Aave deal with.
The fee of mortgage compensation has elevated immensely after the beleaguered crypto lender hired the new law firm Kirkland & Ellis LLP as a part of the restructuring plan. However, the opportunity of chapter submitting can’t be ignored.
Celsius Actively Repays its Aave and Compound Loans
Celsius withdraws 63.50 million USDC from FTX to repay the Aave mortgage of $71 million. The excellent Aave mortgage is USDC value $8.42 million and REN value $80,000. Undoubtedly, Celsius could repay its Aave debt utterly by at this time itself.
Besides Aave, the crypto lender has an excellent Compound debt of $50 million in DAI. Also, an excellent $3.20 million fUSDC mortgage from Notional Finance is to be repaid by September 25.
Interestingly, Celsius has withdrawn 400,000 Staked Ethereum (stETH) collateral value $416 million after repaying the USDC debt on the Aave pockets deal with. However, the dearth of stETH liquidity might stop Celsius to dump all stETH tokens. The Aave deal with is at present left with $10.92 million stETH.
DeFi analyst DeFiyst doubts the stETH might go to Curve pool, the tweet reads:
“My gut says this is all contingent on the C11 Bankruptcy docs being drafted. If they can make a feasible case to the Judge for them to hold stETH exposure PIK, as they believe it will result in higher value returned to creditors, then they can hold. Else, they will sell OTC.”
Do Loan Repayments Mean Withdrawals or Bankruptcy?
Celsius on July 7 closed its outstanding Maker loan, paying off over $220 million in only a week. Thereafter, the crypto lender dumped virtually $500 million value of wBTC to FTX.
Now, the Aave mortgage is nearly closed as Celsius actively repays excellent Aave and Compound loans. Moreover, the agency has eliminated stETH collateral and moved it to a distinct pockets. As per phrases and situations, if Celsius becomes bankrupt clients might lose all funds.
Making Celsius to renew withdrawals is likely to be the one choice. However, resuming withdrawals will give clients a possibility to take away all their funds. Thus, a restricted withdrawal choice may help decrease the rising FUD.
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