5th Regulator Investigates Beleaguered Crypto Lender Celsius

Alabama, Kentucky, New Jersey, Washington and Texas will be looking into crypto lending platform Celsius

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  • Celsius froze withdrawals of user assets earlier this week, citing market conditions
  • Regulators want to ensure incidents like this do not occur again

Five state regulators have opened investigations into the dealings of Celsius, the cryptocurrency lender now in limbo after suddenly freezing withdrawals due to “extreme” market conditions. 

The Texas State Securities Board unveiled its probe into the company’s activities on Thursday. 

Four states — Alabama, Kentucky, New Jersey and Washington — are set to join Texas, Reuters reported

Officials had been investigating the matter since Monday morning and the situation has been considered a “priority.”

The crypto industry has been under scrutiny since the collapse of the stablecoin UST, which sent shockwaves across the market after it wiped out billions of dollars. This is the second major blow in as many months, leaving digital assets traders, service providers and investors under mounting duress. 

Unlike traditional financial institutions, cryptocurrency lenders are not subject to many risk management and capital disclosures. Their deposits are not government-backed or otherwise insured. 

It’s not the first time that Celsius has made its way into the forefront of regulators’ radars. In September last year, Celsius was given a cease and desist letter by state regulators in Alabama, New Jersey and Texas ordering that its products needed to be registered as securities.


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