Two anonymous sources indicated that Goldman Sachs wants to raise $2 billion from investors. This measure is necessary in order to buy up distressed assets from the crypto lender Celsius.
To begin with, let’s try to figure out which of the assets of Celsius became problematic. Citing “extreme market conditions,” the cryptocurrency platform announced on June 12 that it would stop withdrawing funds from the platform. Against this background, there was panic, and the very next day, June 13, 2022, the price of the native Celsius token (CEL) fell by about 50%. It is worth noting that Celsius employees managed to stabilize the situation quickly enough and the value of the token quickly recovered.
However, this was not enough to avoid problems. The founder of Crypto Pragmatist, an analytical firm, Jack Niewold said that Celsius is in a liquidity crisis, and bankruptcy is a possibility in the future.
THE CELSIUS BLOWUP, EXPLAINED.
— Jack Niewold 🫡 (@JackNiewold) June 13, 2022
Huge sectors of crypto are imploding, and crypto unicorns might be coming down with it.
Luna was first, but now $10b giant Celsius is facing insolvency and even bankruptcy.
Let's dive in:
It is no coincidence that we can see a mention of Luna in this text in the tweet, some experts believe that the problems of Celsius are also connected with the collapse of Terra. According to an investigation by Nansen, Celsius used UST presumably in order to carry out high-yield farming on Aave. The investigation also has information that Celsius was one of the “whales” of the Terra ecosystem. However, the founder of the platform, Alex Mashinsky, denied this information.
Celsius and it’s community did not profit or benefit from the Luna/UST situation. At no point did Celsius have a position that would have benefited from a depeg
— Alex Mashinsky (@Mashinsky) May 28, 2022
As stated before @CelsiusNetwork did not have any meaningful exposure to the depeg
Thus, we can assume that the collapse of Terra could have negatively affected the financial position of Celsius.
The presence of problems at Celsius is also indicated by the fact that not so long ago it became known that the company hired restructuring lawyers from Akin Gump Strauss Hauer & Feld. And also, according to the Wall Street Journal, Celsius contacted the restructuring consulting firm Alvarez & Marsal.
To make the situation less risky, Goldman Sachs can become an intermediary in a deal with Celsius. This is necessary so that investors can raise $2 billion to buy assets. According to insiders, the deal will take place through Goldman Sachs’ asset management division. This will allow investors to buy Celsius assets at a discount, even if it remains solvent. Speaking of this, it is important to note that according to one of the anonymous insiders, Goldman Sachs will not own or control the acquired assets. It is not yet clear whether the deal will take place and what the consequences will be for Celsius, but we will monitor the situation.
