Celsius freezes transfers and withdrawals, citing 'Extreme Market Conditions'

On Sunday night, the crypto lending protocol Celsius announced that all withdrawals, swaps, and transfers between users' accounts will be paused in order to stabilize liquidity and operation amid extreme market conditions, while the team will be working on preserving project’s assets.

“We are taking this necessary action for the benefit of our entire community in order to stabilize liquidity and operations while we take steps to preserve and protect assets. Furthermore, customers will continue to accrue rewards during the pause in line with our commitment to our customers” the Medium post says.

While the crypto community has reacted to this sudden halt with criticism, the additional suspicion and scam accusations have been fuelled by the rumors that Celsius has allegedly unstaked massive amounts of wrapped bitcoins and ETH from Aave into the FTX exchange for uknown reasons.

🚨Celsius withdrew 50,000 Ether and 7,000 WBTC collateral from its Aave position in core DeFi wallet 0x8ace. 6,000 WBTC and 20,000 Ether (so far) have been sent to #FTX...

After receiving $169 mil $USDC from FTX... pic.twitter.com/xquMoIcyuZ
— Dirty Bubble Media: 🌡⏰💣 (@MikeBurgersburg) June 13, 2022

The suspicious behavior has also been confirmed by PeckShieldAlert in a Twitter post stating that Celsius transferred around 3,500 wBTC to FTX exchange.

#PeckShieldAlert Celsius transferred ～3,500 $WBTC (~$89m) to FTX within the last hour. https://t.co/nKCorHfuex pic.twitter.com/juiz6NmOpN
— PeckShieldAlert (@PeckShieldAlert) June 13, 2022

As Etherscan shows, unusual token transactions started on Celsius main wallet last Sunday at 6:00 p.m. EST, when it started unstaking wBTC from Aave, which is used by Celsius to earn interest on its deposits. In total, $320 million worth of liquidity has been transferred to FTX exchange in a series of transactions.

While all major coins are drastically losing their values, this news has dropped the Celsius token CEL prices by 53% over the last 24 hours, as of the time of writing the token was trading at $0,182872 Celsius CEO Alex Mashinsky hasn’t given any comments regarding the latest developments apart sharing the Celsius blog post on Twitter.