An Irishman is in danger of losing his farm. An American with suicidal thoughts. Lost Life Savings of an 84-Year-Old Widow: Those trapped in the recession of crypto lender Celsius are asking for their money back.
Hundreds of letters have been sent to the judge overseeing the firm’s multi-billion dollar bankruptcy and they are heavy with anger, shame, frustration and, often, remorse.
“I knew there were risks,” said one customer, whose letter was unsigned. “It seemed like a worthwhile risk.”
Celsius and its CEO Alex Mashinsky billed the platform as a safe place for people to deposit their crypto currencies in exchange for high interest, while the firm lends and invests those deposits.
But as the value of highly volatile cryptocurrencies plummeted – bitcoin alone has fallen by more than 60 percent since November – the firm faced growing troubles until withdrawals were halted in mid-June. .
According to a court filing earlier this month, the company owes $4.7 billion to its users, and the endgame is unclear.
The letters – posted in a public online court docket – come from all over the world and explain the sad consequences of users’ money being deposited.
“From that hardworking single mom in Texas who is battling past due bills, to the teacher in India who has deposited all her hard earned money in Celsius – I believe I speak for most of us. When I say I’ve been cheated, embarrassed, sad, angry,” wrote one customer who signed their letter to EL.
While letters about the crypto world vary in their level of sophistication – from self-confessed novices to all-preachers – and monetary implications range from a few hundred dollars to seven-figure sums, almost everyone agrees on one thing. There are.
“I have been a loyal Celsius customer since 2019 and have completely lied to Alex Mashinsky,” wrote one customer, who AFP is not identifying to protect his privacy. “Alex will talk about how Celsius is safer than banks.”
Several letters point to the CEO’s AMA (Ask Mashinsky Anything) online chat as key to his trust in him and the platform, which presented itself as stable until a few days before users’ funds were frozen.
reassurance before falling
“Celsius has one of the best risk management teams in the world. Our security team and infrastructure are second to none,” the firm wrote on June 7.
“We have made it through the first crypto meltdown (this is our fourth!). Celsius is ready,” the firm wrote.
The message also said that the company has reserves to pay off its obligations, and withdrawals are being processed as normal.
One customer, who reported having $32,000 in cryptocurrency locked up at Celsius, noted the effect.
“Right to the end, the retail investor is assured,” the customer wrote to the judge.
But that quickly changed, and on 12 June Celsius announced a freeze: “We are taking this action today to better position Celsius to honor its withdrawal obligations, over time.”
Some customers got the news in a message from the company.
“By the time I finished the e-mail, I had fallen to the floor with my head in my hands and I shed tears,” wrote one person, who had a net worth of about $50,000 with Celsius.
Customers who said they were the hardest hit, including a man who said he had kept $525,000 received from government loans on Celsius, revealed that he had considered killing himself.
Others reported feelings of immense stress, lack of sleep, and deep shame for putting their retirement savings or their kids’ college money on a platform that was far more risky than they knew.
“As a private unregulated company, Celsius is not subject to any disclosure requirements,” the Washington Post summarized the situation.
Celsius did not respond to requests for comment on customers’ letters.
For people like an 84-year-old woman who had about $30,000 in crypto savings on Celsius for a month, their hope lies in bankruptcy proceedings.
“It’s not unusual for people to come out like this with zero,” said Don Coker, an expert witness on banking and finance.
“Obviously I feel sorry for anyone who loses this kind of investment, but it’s something where they need to be aware of the risks,” he said.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)