On Sunday, Celsius's digital currency, the CEL, began to plummet, and that's where the issue began.
As the value of CEL plummeted, the Celsius firm decided to impose a ban on consumers. Removing the possibility of anyone withdrawing, transferring, or converting cryptocurrencies from the account. The firm did not elaborate on how long the facilities will close. Celsius's decision also affected Binance, the world's largest cryptocurrency exchange platform. And forced it to suspend bitcoin issuance for several hours.
According to the Celsius company, which has offices in the United States. In the United Kingdom and Lithuania, the decision to freeze the account is in the best interests of consumers. As a result, precautions are to safeguard their assets. It is to notify that in just one year, the value of Celsius company's currency has dropped from seven US dollars to zero point twenty dollars.
The Celsius system rewards its customers with high-interest rates. For keeping cryptocurrencies in the network. This means that if a bitcoin holder stores his currency on a Celsius platform, he will reward them in return. The user also agreed with the statement that no transaction will be done using this currency. In general, the higher the incentive, the longer a person keeps his digital currency in storage.
It is like a system where one puts one's money in a savings account in a bank. The only difference is that, unlike the banking system, there is no legal protection in the digital world.
According to Celsius's website, the company pays interest at 7% on currencies such as USDC and Tether, 7.25% on a polygon, 6% on Ethereum, and 6.25% on bitcoin. Given market conditions and interest rates, no ordinary bank in the world can offer such a profit.
Following the recent decision. Celsius has announced that customers will continue to receive rewards while the account was frozen. America's largest economic regulator has warned against profiteering promises that may seem unlikely to come true.
Earlier in March, three European economic authorities warned consumers. That cryptocurrency businesses were at risk and that their use as an investment or transaction would not benefit most people.
Despite all these statements, Sam Theodore. A senior consultant at Scoop Group, says that "the fever of cryptocurrency is not going to go away anytime soon." Investing in currency. Unfortunately, no statistics exist on how many of these investors are familiar with cryptocurrencies.
Paul Donovan, the chief economist at WBS, says the collapse of the cryptocurrency market is not important for the real economy.
"Corruption is falling again," he says. Does it matter? no. Corruption is a gamble, not an investment. When the resources employed in bitcoin are in good use, the economy will profit.