Bitcoin dropped below $25,000 to its lowest level since December 2020 as Celsius Network paused withdrawals, swaps and transfers on its platform, fueling a broader market selloff.Celsius Network paused withdrawals, swaps and transfers on its platform, fuelling a broader market sell-off as traders continued to question the sustainability of high-yielding crypto products in the wake of the Terra blockchain collapse.
Doubts about the sky-high yields backing products such as those Celsius offers have intensified after Terra’s collapse in May and as tighter monetary policy from global central banks curbs demand for riskier assets. The CEL token promises “actual financial rewards, including as much as 30 per cent extra returns weekly, according to its website.
In announcing the freeze, Celsius said: “We are taking this action today to put Celsius in a better position to honour, over time, its withdrawal obligations. It added that users will continue to accrue rewards during the pause. “The Celsius news added fuel to the fire, adding to the uncertainty in the market, said Vijay Ayyar, vice-president of corporate development and international at crypto platform Luno. “There is a lot of pressure on prices as we go into the week of Fed decision coupled with concerns on the protocols offering high-yield products.”