'Coin Run' Due to Cryptocurrency Crash... Celsius Withdrawal Freeze

‘Coin Run’ Due to Cryptocurrency Crash… Celsius Withdrawal Freeze

Coinbase shares plunge 11.41% after being sued for the world’s largest exchange

Coin-related companies started to freeze withdrawals due to the collapse of virtual currency. In the aftermath, shares of Coinbase, one of the largest cryptocurrency exchanges in the United States, plunged more than 13%.

According to CNBC on the 13th (local time), Celcius Holdings, a cryptocurrency-backed loan company, has taken measures to suspend emergency withdrawals. In the meantime, Celsius provides a service that allows users to re-loan up to 70% of Ethereum using the virtual currency ‘stETH’ as collateral when users deposit Ethereum in Lido Finance, a ‘DeFi (Decentralized Finance)’ protocol. have done

However, as the price of Ethereum plummeted, concerns about the occurrence of a ‘coin run’ increased. It was a move to recover the principal right before the coin price fell further. Celsius Holdings said there was nothing wrong with it, but as the situation worsened, it froze transactions and temporarily suspended withdrawals and transfers. According to CoinGecko, the price of Ethereum reached $2,040.65 on the 14th of last month (local time), but as of the 13th of this month, it has fallen more than 40% to $1,115.08.

“Due to extreme circumstances, all withdrawals, cryptocurrency swaps, and transfers between accounts have been temporarily suspended,” Celsius explained. Celsius has 1.7 million users.

In addition, Binance, which is considered to be the world’s largest cryptocurrency exchange, has also returned to its original state after halting trading. However, Binance was sued that day. According to Reuters, Jeffrey Lockhart, an investor in the South Korean stablecoin TerraUSD (UST), filed a claim for damages against Binance’s US subsidiary and CEO Brian Schroder on the same day. The claim is that Binance’s US corporation falsely advertised the UST as a safe asset and backed by fiat currency.

Coinbase, the largest cryptocurrency exchange in the U.S., also suffered a blow as concerns over the cryptocurrency crash and coin run grew. Coinbase shares fell 11.41% to $52.01 on the day. Coinbase generates revenue through transaction fees, but sales have declined due to price declines. Sales in the first quarter of this year were $1.17 billion, down 27.1% from the same period last year.

As of 11:30 a.m. on the same day, the Bitcoin price was recorded at $21,087.9, down 16.82% from the previous day.