143M loan repayment to Maker avoids liquidation

Crypto lending platform Celsius surprises Maker with $143 million in loan repayments, avoiding liquidation of its deposited assets. For the New Jersey-based company, the event marks a positive development during its current liquidity crisis.

Celsius repays debt

Apparently little has changed in Celsius’ situation over the last few days. Customers of the service are still not allowed to withdraw their funds. But the company may be able to take the first steps toward stabilization.

As of July 1, the Celsius Network has been able to pay off $142.8 million in debt. The last repayments came in mid-June, when Celsius stopped paying customers.

At the same time, thousands of Wrapped Bitcoin were deposited, such as Data from Defiexplore To take. Celsius is doing all this to avoid an imminent liquidation of the collateral.

According to Defiexplore, Celsius’ position is stable again, at least compared to Maker.

With a current security of 23,962 WBTC, there are only 82 million DAI in debt. The overcollateralization of at least 145 percent required by Maker is now a full 589.62 percent.

For Celsius’ position to be liquidated, the price of Bitcoin would have to fall from the current $20,000 to around $5,000. After the crypto market reached its all-time high in November 2021, the situation deteriorated and liquidation came ominously close.

The crypto crash that began in May made things worse, leaving Celsius just four percent away from resolving a loan on May 12.

Celsius owes a lot to Aave and Compound

According to Defiexplore, Celsius Maker still owes 82 million DAI while it loud zapper only around 77 million DAI are left. What is certain is that Celsius is still deeply indebted – including to crypto lenders Aave and Compound.

Aave’s loans still contain around $178 million in various assets – mainly USD Coin and DAI, but also a small position in REN.

Compared to Compound, another hundred million of the stablecoin DAI are due sooner or later. In comparison, a loan of USD 3 million from Notional Finance seems negligible.

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Alex Mashinsky downsizes Celsius workforce

The fact that things are not going well for Celsius is shown by the most recent news about the downsizing of the workforce. According to this, CEO Alex Mashinsky made the decision to lay off 150 people, who make up more than a fifth of the total workforce.

In view of the critical situation, negotiations are currently being held with lawyers and business consultants about the possible formal declaration of insolvency.

Defiexplore shows the decline in the value of Celsius systems. A summary statistic credits Vault 25977 with losses of $655 million, although apparently it never went into liquidation.

The sole culprit is the falling market value of Bitcoin. Celsius never officially stated that this is their own vault. In the crypto scene, however, this is considered an open secret.

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