Celsius network has been one of the most affected platforms in this bear market. They even paused withdrawals, and this created panic among users because of the huge debt they had. However, the platform has started to fulfill its debt now, with just $59 million remaining as it pays off another $81 million it owed to Aave. This brings the protocol even closer to becoming debt-free which also means that we might soon see user withdrawals being unfrozen on Celsius.
Celsius Network pays off another $81 million in debt
The liquidity troubles that Celsius Network was facing will be gone soon. Their $81 million payment to Aave freed up $410 million in ‘stETH’ tokens. Apart from this, they are making payments to other platforms that they owe and are freeing up more tokens. Talking about the latest payment made to Aave, they have paid in USDC, and the exact amount was $81.6 million. After this payment, Celsius owes relatively less than $8.5 million to Aave.

The most important part about the payment was the $410 million in stake ethereum that was freed. This was used by Celsius as collateral against the loan they acquired from Aave. If you are wondering what is ‘stETH’ token—the most important point is that 1 stETH = 1ETH. It is a derivative token of ETH and represents Ethereum locked up on the upcoming POS network.
stETH has a market cap of around $4.4 billion, which makes Celsius’s holdings one of the largest. So, when stETH fell below 1 ETH, the liquidity crunch happened, and now it is 3% below the peg.
Celsius’ downfall and recovery
The platform managed nearly $20 billion in deposits from clients, but poor liquidity management and market conditions led them to suspend withdrawals. However, after it started to pay off its debt, the platform’s recovery began. It freed $440 million in WBTC from Maker after paying the $228 million debt they owed. Now, the only debt that remains is $8.5 million to Aave and $50 million to Compound. Once Celsius pays these amounts, they will free up another $227 million in total locked on the platforms.
What are your thoughts as Celsius Network pays off another $81 million in debt and reclaims $420 million in stETH? And do you think they will be able to pay back the remaining $58 million? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.
Also Read: Uniswap liquidity provider loses $8 million in a phishing attack.