FTX didn’t acquire Celsius Network due to the poor condition of its balance sheet. Celsius had nearly a “$2 billion hole” in its finances. They have been one of the most affected platforms due to the crypto crash and even had to pause withdrawals due to its investors juggling around funds to chase the highest returns. Celsius suffered a loss of 38,000 Ethereum and $22 million due to a hack of Badger DAO. So, there were talks that FTX might acquire the company.
FTX CEO Sam Bankman’s bear market strategy
FTX’s CEO has adopted a proactive approach to the crypto bear market. After the fiasco of Three Arrows Capital, the company extended a $500 million credit line to Voyager Digital and a $250 million to BlockFi. Both of them had exposure to 3AC and were facing a major problem as the firm even got liquidated recently. Apart from this, Sam also acquired a stake in Robinhood as their shares are trading at quite a discount.
He is using this bear market to expand his portfolio, and it’s clear that his net worth will balloon when the bull market kicks in. However, FTX not acquiring Celsius is the right strategy. After all, Sam recently warned about a lot of 3rd-tier exchanges going under due to the bear market.
Celsius Network
It is a platform designed for lending and allows users to earn interest if they deposit funds or take loans keeping their crypto as collateral. This way users do not have to sell their holdings in case they are in need of money and keep profits as the prices go up. The platform used to offer high returns to users depositing their funds and provided to get dollars for borrowers. However, we all know now that high-yield protocols do not work very well in a bear market and that’s what happened.
The native token of Celsius is more than 90% down from its all-time highs and is currently trading near 60 cents. Even in the last 24 hours, it is down by 18% as Bitcoin again broke below the $20k threshold. It is quite unlikely that the price of the token will see new highs again.
What are your thoughts as FTX didn’t acquire Celsius Network due to their poor balance sheet? And do you think there is any hope left for the network? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.
Also Read: Nubank starts offering crypto trading to all its customers.