Insolvency and scams across DeFi exchanges and crypto companies is killing trust
Picture this
You are aboard the Titanic, with your husband/wife and kids, after paying your hard-earned money to buy the tickets and start a new life in the Americas. Suddenly, due to poor vision and leadership from the captain and the crew, the ship bumps into an iceberg and starts to sink. Somehow, you manage to get your family and yourself in a lifeboat and sail away, as you see the ship, all your personal belongings, and future life sink with it while all you can do is watch. However, at least you are alive, but others aren’t so lucky and drown.
Well, from a financial standpoint, that is exactly what happened to people with personal assets in Celsius, as Monday, June 13th, Celsius paused withdrawals due to ‘increasing risks of insolvency’.
To better understand what is going on with Celsius, let me go back to the previous analogy:
You have a great part of your money in Celsius, after investing your hard-earned money to try and earn some interest on your savings. Suddenly, due to extremely poor management by the Celsius team, massive drops in liquidity cause the exchange to pause withdrawals, so now you can’t get your money out of the exchange, even though you are seeing the exchange collapsing. Somehow, you have managed to take out some of your investments before the halt, but some of your friends couldn’t, having all their savings in an exchange…
