An anonymous source told Financial Times that if the company had waited longer, it could have made a profit amid the collapse of the cryptocurrency market

Media: Celsius lost millions of dollars due to interference of the platform’s head in trading

17.08.2022 - 12:20

265

2 min

What’s new? The Financial Times has reported on why the bankrupt crypto platform Celsius lost hundreds of millions of dollars. So, in January 2022, the company’s head Alex Mashinsky took over the management of the trading strategy. That same month, the US Federal Reserve System (Fed) was about to announce a change in monetary policy aimed at slowing inflation. Mashinsky expected the crypto market to decline in the face of these announcements. So he sold “hundreds of millions of dollars’ worth of bitcoin, expecting to buy them back at a discount, but the market moved in the opposite direction and the company incurred large losses. Information about this appeared in a Financial Times report.

The Financial Times report

What else does the report say? According to experts, Celsius was forced to buy back its digital assets at a loss when BTC and other cryptocurrencies rose. Mashinsky’s involvement in the work of the sales department sparked a conflict among employees, the FT reports. The company’s former chief investment officer, Frank van Etten, questioned Mashinsky’s strategy and his involvement in making investment decisions. Van Etten left the company in February 2022.

An anonymous source of FT noted that if Celsius had waited longer, it could have made a profit amid the collapse of the cryptocurrency market. But, according to him, the company traded based only on its own assumptions.

Earlier, Celsius’ creditor committee launched an investigation into the head and insiders of the platform. The group intends to uncover potential misconduct on the part of Mashinsky. Also, analytics firms Nansen and Arkham Intelligence recorded several transactions that were made through an address associated with the head of the company. According to Etherscan, he exchanged 17 475 native tokens of Celsius (CEL) for ETH worth $28 242.

To find out what caused the bankruptcy of Celsius, one of the largest crypto lenders, see GetBlock Magazine’s feature.

Author:

Tatiana Darda Tatiana Darda

Subscribe to Getblock Magazine and stay up to date with the latest news from the world of cryptocurrencies and the digital economy