Sunday, September 25, 2022

Celsius Now Free From DeFi App Debt After Paying Out $800M

Celsius finally pays off all its debt owed to the decentralized finance (DeFi) applications. Celsius Network was initially owing Aave, Compound, and MakerDAO up to $800 million worth of cryptocurrency. Since the last month, the distraught crypto lender started paying out the debt owed to these firms.

Celsius Network which has its headquarters in New Jersey is a cryptocurrency lending firm. The firm has a record of about 1.7 million users globally.  The firm operates from only four countries but still holds its activities worldwide. Recently, the crypto lender has constantly been in the news.

Crisis At the Doorstep of Celsius 

First, Celsius decided to suspend the withdrawal operations from its platform owing to the prevalent extreme market conditions. Its swap and transfer products feature was also disrupted. The firm assured its users that operations would be restored as soon as possible but no specific date was given.

Not long after, Nexo, another crypto lender offered to help Celsius by acquiring the troubled lender’s remaining qualifying assets. Nexo will absorb Celsius of all its loans. Thereafter, Nexo stands to gain possession of all Celsius customer databases. Some other firms also offered to assist Celsius amongst which are Swan Bitcoin and FTX Ventures.

Unlike the others who offered to help, FTX pulled out of its initial plans to acquire the troubled lender. It blamed the decision on the awful state of the crypto firm at that time. Later, KeyFi, a DeFi aggregator dragged the crypto lender to court on the basis of fraud.

Compound Receives Last Chunk of Debts

Defying all of these obstacles it had faced, Celsius started clearing off its DeFi App debts gradually. Starting with MakerDAO, Celcius paid back all its debt and took out $440 million worth of wrapped Bitcoin (BTC). Successively, it made a reclaim of $124 million worth of wrapped BTC and  $417 million in staked Ethereum (ETH) from Aave. 

The repayment was concluded today when the lender withdrew about $200 million in wrapped BTC from Compound. The lender has finally paid the last chunk of it which summed up to $800 million.

Victoria Nye
A Blockchain columnist who is enthusiastic about developing a network interface between the real world and the cryptosphere.

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