Embattled crypto lender Celsius acquired a second buyout provide this week amid rising considerations over its insolvency.
This provide comes from lender Chainge, which earlier within the week issued a letter of intent to purchase out “certain” companies and property of Celsius.
Chainge didn’t specify what property of Celsius it intends to buy, however mentioned that it’ll probably retain the entire lender’s workers after the deal. Chainge mentioned it can difficulty a definitive announcement on the deal.
The provide is the second buyout deal for Celsius after the lender suspended withdrawals final week, as a result of a liquidity crunch. Peer Nexo had earlier offered to purchase the agency’s debt obligations.
Chainge desires to keep away from contagion from Celsius
The crypto lender mentioned a Celsius insolvency would harm the complete crypto market, and that such a situation needs to be averted.
@CelsiusCommunity probably dealing with insolvency impacts us all. We strongly consider there isn’t a higher manner of shifting ahead than working collectively in direction of decentralization.
The lender mentioned its provide isn’t a fast repair, however intends to create a long-term sustainable system that assures asset custody.
Lido Staked Ethereum behind latest woes
Celsius’ latest liquidity woes stem from a drop within the worth of Lido Staked Ethereum (stETH), a DeFi token generally utilized by the lender as collateral.
A drop within the worth of the token uncovered the token to a number of margin calls from its lenders, which it was unable to satisfy. This resulted in a number of of the lenders positions being liquidated.
Celsius isn’t alone in its publicity to stETH. Hedge fund Three Arrows Capital confronted an identical situation, as did lender BlockFi. The latter lately received a $250 million bailout from crypto exchange FTX.
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