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Celsius Network: Ponzi scheme has been bankrupt since 2019

 


A lawsuit was filed against Celsius in the US by KeyFi in July . In it, the plaintiff claims that Celsius still owes money from a revenue share and is also said to have operated as a Ponzi scheme. KeyFi feels deceived and harmed by Celsius's business practices, which raised the question months ago whether Celsius actually engaged in unfair competition. Now the suspicion is confirmed, because investigations into Celsius make it clear that the company was already bankrupt in 2019.


In the US state of Vermont, the regulatory authority is investigating. She believes that Celsius artificially inflated the supply for the CEL token in order to manipulate the company's balance sheet. In addition, insiders are said to have enriched themselves with this approach at the expense of small investors, according to the accusation.


This means that the regulatory authority is bringing three extremely serious allegations to the court that is conducting the insolvency proceedings. Market manipulation, delay in bankruptcy and unfair competition through the operation of a Ponzi scheme.


Mashinsky's tweets fly in the face

Celsius CEO Alex Mashinsky publicly assured as late as May 2022 that Celsius had not suffered any serious losses. This and other statements by Mashinsky have already drawn sharp criticism from the press and investors.


The mere fact that Mashinsky publicly assured that all customer funds are safe, only to freeze all customer accounts a short time later, is unforgivable. The authorities in Vermont agree and calculated that at the time of both statements, Celsius was already 454 million US dollars in debt.


Even more serious, however, is that Celsius' CFO is said to have admitted to the authorities that, from his point of view, insolvency had already occurred from 2020. Because you were never able to pay out the promised returns from the profits, the result is a pyramid scheme. Because thus promised funds could only be taken by inflating the CEL course and winning new customers. Now regulators are investigating in 40 US states and it is foreseeable that this will have repercussions for the beneficiaries of the failed Celsius Network.

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