Crypto Chaos Continues as Loans Firm Cuts Withdrawal Limit, 3AC Moves Funds, & Celsius Apparently Pays Maker

Celsius Network Exchange Three Arrows Capital

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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October 23, 2023 08:55 EDT

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Crypto turmoil continues to deepen in the bear market, with more Celsius-related developments, another crypto loans firm introducing restrictions, and more activity from Three Arrows Capital (3AC) – which appears to have moved some of its funds.

Temperature Rising for Celsius

Celsius, which operates the celsius (CEL) token and the eponymous blockchain network, appears to have begun paying back a large portion of the debt it owes to the Maker (MKR) protocol.

Statistics from the DeFi Explorer platform show that a vault believed to be owned by Celsius began making its most recent DAI repayments on July 1. It followed up with another on July 3 and two more on July 4 – making for a combined total of USD 142.8 million. A number of repayments were also made in mid-June.

The vault makes use of wrapped bitcoin (WBTC) as collateral, meaning that the vault will automatically be liquidated should BTC fall below a safety level. Last month, that liquidation price fell to around USD 17,000 – with BTC hovering around the USD 20,000 mark.

Celsius, which has recently slashed a quarter of its workforce, per a report from Israel, still appears to owe Maker USD 82 million. This apparent move does appear to indicate, however, that the firm has not yet given up the ghost – amid widespread fears that it could join the fast-growing ranks of crypto bankruptcies.

Celsius has previously claimed it is “working as quickly” as it can to “stabilize liquidity and operations” – although insolvency fears continue.

3AC Still ‘Running Free?’

The ailing crypto hedge fund 3AC, as previously reported, has been ordered to liquidate by a British Virgin Islands court and has also been seeking protection from creditors in the United States under the terms of the Bankruptcy Code, which lets overseas debtors protect America-based assets. But there are still signs of life from Three Arrows – which now seems to be moving tokens.

The Peck Shield Alert Twitter account provided evidence of what appears to be two sizeable 3AC stablecoin transfers onto the KuCoin platform “within the last 24 hour[s].”

#PeckShieldAlert 3AC transferred ~10m $USDT and ~20m $USDC into Kucoin within the last 24 hour. pic.twitter.com/VxxrfQtrNt

— PeckShieldAlert (@PeckShieldAlert) July 5, 2022

Incredulous observers asked how it was possible that 3AC was “still running free,” while Loi Luu, the co-founder and Chairman of the Kyber Network, mused:

“Wait, how are they still able to send assets around? [I] thought at this point the court appointed liquidator [had] already stepped in.”

Limits at CoinLoan

The Estonia-based crypto lending platform CoinLoan has slashed its 24-hour withdrawal limit to USD 5,000 – down from USD 500,000.

The firm wrote in a statement that it was not in trouble, but that “like any company, we must take notice of the market.” It added that the move was a “temporary change,” but one that has already been enacted.

CoinLoan claimed that the “measure” would let them “ensure stable platform operations now and in the future.”

The company further added that suspending all withdrawals “like some other companies have done” would have been “more convenient” from a business perspective, but added:

“We understand that some of you may be storing your life savings on CoinLoan, so we cannot simply disable withdrawals. Thus, we are only lowering the limit, so you can withdraw a portion of your assets if necessary.”

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Learn more: 
– Fresh Blow for Celsius with 150 Staff Reportedly Fired, but CEL Rallies
– Celsius’ Positions are Now Healthier, Three Arrows Capital Was a ‘Victim of Contagion’ – Nansen

– Crypto Turmoil: 3AC Files for Bankruptcy, FTX and BlockFi Agree, Suspensions at Voyager
– Three Arrows Reprimanded by Singapore

– KuCoin Denies Rumors
– New AML Legislation Won’t Forbid Individuals to Hold Crypto, Says Estonia’s Ministry of Finance