In addition to suspending withdrawals for users, Celsius has moved more than $24 billion in Aave funds to the FTX exchange for reasons that have not been disclosed.
Celsius may be dealing with its rumored liquidity crisis by unstaking $247 million worth of Wrapped Bitcoin from Aave and sending it to the FTX exchange.
The crypto community is abuzz with speculation after the project moved massive amounts of WBTC, ETH, and other crypto-assets while also suspending withdrawals for users.
Following the collapse of the Anchor Protocol on the now-named Terra Classic blockchain, Celsius users have criticized the platform for how they believe the project mismanaged its funds. With the recent moves to stabilize liquidity, the project may be addressing those concerns.
Some believe that if Celsius fails, it will sell a significant amount of staked ETH (stETH), causing it to depeg further from ETH. The Lido DeFi lending platform provides the stETH token as proof that a user has staked ETH. It is currently trading at a 4.4 percent discount to ETH.
Unusual token movements from Celsius’s main DeFi wallet began around 18:00 ET on June 12 when it began removing WBTC from the Aave staking and lending platform, which Celsius used to earn interest on its deposits.
A total of 9,500 WBTC tokens worth approximately $247 million have been redeemed from Aave. All of those tokens were sent to the FTX exchange for an unknown reason after a series of transactions.
In addition to WBTC, it appears that 54,749 ETH worth approximately $74.5 million was sent to FTX.
While such activity bodes poorly for Celsius’s transparency until it explains the moves, the company may be attempting to ensure its liquidity is stable by replacing many of the volatile funds it withdrew from Aave with stablecoins.
Celsius has staked 204 million USDC stablecoins on Aave since June 12. It has also deposited 10 million USDC as well as approximately 8.2 million DAI stablecoins to Compound, another DeFi staking and lending platform.
The total 222 million stablecoins re-staked by Celsius is nearly equal to the value of WBTC tokens removed, but it still falls short of the combined value of WBTC and ETH.
The Celsius team’s plans for the cryptos that have been moved remain unknown. It may sell the assets it sent to FTX, but another possibility is that it will stake the tokens it is sending to the exchange to earn yields.
Celsius has sent 9,500 WBTC, 54,749 ETH, 375,343 FTT worth $10 million, 2,455 MATIC ($1,158), 260,000 UNI ($1 million), 2 million Pax Dollars (USDP), and 300,000 TrueUSD (TUSD) stablecoins to FTX as of the time of writing. However, token movements continued until 23:00 ET.
Celsius users may be nervous right now because the platform paused withdrawals to “put Celsius in a better position to honor, over time, its withdrawal obligations,” according to a June 13 announcement from the project.
“We are working with a singular focus: to protect and preserve assets to meet our obligations to customers.”
The latest round of FUD from Celsius has largely disappointed cryptocurrency investors. Over the last 24 hours, the total crypto market cap has fallen 7.6 percent to $1.07 trillion. CEL, Celsius’s token, has fallen more than 60% in the last 12 hours to $0.15. All prices in the article were obtained from the price tracker CoinGecko.
