The saga that has been Celsius’ downfall this year has been well documented. CEO Alex Mashinsky has been a focal point of crypto critics after his engagement in ‘taking over‘ Celsius’ crypto strategy in the 11th hour before the platform’s pseudo-shutdown.
That isn’t slowing down a persistent Mashinsky, who, despite enduring a slew of bankruptcy procedures, continues to trudge along in forecasting One of a kindFuture for Celsius According to The New York Times’ new report, Mashinsky will reposition Celsius this week as a digital asset custodian firm.
What Led To Today’s Celsius ‘Doom & Gloom’
A few years ago, state regulators in a handful states began to focus on platforms that generate yields such as BlockFi or Celsius. Celsius was for some time offering high rates for tokens held on its platform. At it’s highest point last year, Celsius held tens of billions of funds and at times, promised double digit percentage yield that was compounding weekly.
As 2022 came into the fold, the market was middling but certainly not into ‘bear mode’ when Mashinsky and company rolled out their initial “custody solution.” Within a few months later, following the crumbling of Terra Luna, the platform was revealed to have exposure to DeFi protocols, including the likes of Terra’s Anchor Protocol, and was experiencing strong headwinds from more aggressive market conditions. Mashinsky began to strengthen his company strategy position around this point. The company filed for bankruptcy in July after it had already frozen its user funds.
Celsius (CEL) token's short-term performance has been volatile.Source: TradingView.com CEL-USD | Source: CEL-USD on TradingView.com
How does the Pivot work?
According to the Times report, in the past week, Mashinsky has proposed a project codenamed ‘Kelvin,’ where Celsius shifts to solely providing custody services and collecting fees from depositors. According to the Times, Celsius employees were rightfully suspicious. Mashinsky countered to internal skeptics, according to the Times, by citing some of the biggest corporate turnarounds, telling employees: “Delta filed for bankruptcy. Do you not fly Delta because they filed for bankruptcy?”
The short stroke is that Celsius’ credibility is just as bankrupt as it’s balance sheet. Take one look at Celsius’ Twitter replies for a prime example. While Delta and Pepsi recovered from bankruptcy, they did so in different eras, and more importantly: neither was beholden to mass amounts of customer’s wealth. It’s possible the identity and brand of the firm are far too distant from reality.
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