The CEO of bankrupt cryptocurrency lender Celsius has allegedly sold large amounts of the project’s native CEL token during the recent surge. The token’s value shot up almost twofold in the past week in what appears to be a community-driven short squeeze.
First Transaction in Late May
Blockchain data shows a cryptocurrency address identified by intelligence firms Arkham Intelligence and Nansen, as CEO Alex Mashinsky made an initial transaction in late May. According to data from Etherscan, the wallet sold CEL tokens in multiple transactions on August 6 and 9, swapping 17,575 CEL tokens for US$28,242 worth of Ether on the decentralised exchange UniSwap.
The transactions were initially spotted by Twitter user ‘alto’:
Arkham Intelligence managed to identify a few of Mashinsky’s wallets that have regularly sold a large amount of the CEL token on numerous decentralised exchanges. Before it declared bankruptcy, the firm listed its largest owners on its webpage, with the CEO reportedly the largest token holder just after the Celsius treasury.
CEL Token Under SEC Scrutiny
Celsius filed for bankruptcy protection on July 13, only a month after freezing all customer withdrawals. The CEL token issued by the firm as a utility token is also facing regulatory scrutiny from the US Securities and Exchange Commission (SEC) for not being registered as a security.
At its peak in October 2021, the crypto lender had US$25 billion in assets under management, according to Mashinsky, but now Celsius is down to US$167 million “in cash on hand” which it says will provide it with ample liquidity to support operations during its restructuring process.
This is little consolation to investors, as under the terms of its bankruptcy filing Celsius owes its users somewhere around US$4.7 billion. Amid its turmoil, Celsius has also had to withdraw its motion to bring back ex-chief financial officer Rod Bolger on a US$92,000 per month salary. Bolger was set to return to the firm as a consultant to help during the bankruptcy proceedings.
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