An Irishman about to lose his farm. An American with suicidal thoughts. An 84-Year-Old Widow Who Lost Her Life Savings: People Caught By Investment Platform Bankruptcy cryptocurrencies Celsius They beg for their money back.
Hundreds of letters brimming with anger, shame, despair and regret have flooded the office of the judge overseeing the multi-million dollar bankruptcy.
“I knew there were risks,” said a customer who did not sign his letter. “It seemed like a risk worth taking.”
Celsius and its CEO, Alex Mashinsky, presented the platform as a safe place where people could deposit their cryptocurrencies in exchange for high interest, while the firm lent and invested those deposits.
But as the value of the highly volatile cryptocurrencies -Bitcoin alone has lost 60% of its value since November- the firm faced more problems, until it froze the withdrawal of funds in mid-June.
The company owes $4.7 billion to its users, according to a court document released this month, and it’s unclear how the matter will play out.
The letters, published in an online judicial archive, come from all over the world and tell of the tragic consequences of the freezing of users’ money.
“From that hard-working single mom in Texas dealing with overdue bills, to the teacher in India who put all his savings into CelsiusI think I can speak for most of us when I say that I feel betrayed, ashamed, depressed, angry,” wrote one of the clients who signed his letter as THE
Although the cards vary in their level of knowledge of the world of cryptocurrencies – from self-confessed rookies to convinced bet-it-alls – and the monetary impacts range from a few dollars to seven figures, almost everyone agrees on one point.
“I have been a loyal customer of Celsius since 2019 and I feel completely attached to Alex Mashinsky,” one customer wrote. “Alex was talking about how Celsius It was safer than banks.
Many letters point to the AMA (Ask Mashinsky Anything) online chats offered by the CEO as the main reason for their confidence in him and in the platform, presented as stable until days before freezing data. user funds.
Repeated guarantees before the crash
“Celsius has one of the best risk mitigation teams in the world. Our security team and infrastructure are second to none,” the firm wrote on June 7.
“We have overcome crises of the cryptocurrencies before (it’s the fourth!). Celsius He’s prepared”.
The message also stated that the company had sufficient reserves to pay its obligations, and that withdrawals would be processed normally.
One client, who claimed to have $32,000 in cryptocurrencies locked in Celsiuswrote to the judge that “virtually until the end, the retail investor received guarantees”.
But that quickly changed and on June 12, Celsius announced the freeze: “We are making this decision today to put Celsius in a better position to honor, over time, their retirement obligations.
Some customers received the news in a message from the company.
“When I finished reading the mail, I collapsed on the floor with my head in my hands and burst into tears,” wrote a man who had around $50,000 in assets in Celsius.
The most affected clients, including a man who said he deposited $525,000 he received from a government loan in CelsiusThey claim to have thought of committing suicide.
Others report high levels of stress, lack of sleep, and feelings of deep shame for depositing their life savings or their children’s college money on a platform that was much riskier than they thought.
“As a private, unregulated company, Celsius is not subject to any disclosure obligation”, summarizes the Washington Post.
Celsius did not respond to a request for information about customer letters.
For people like an 84-year-old woman who only had about $30,000 in savings invested in cryptocurrency a month ago, hope lies in the bankruptcy process.
“It’s not uncommon for people to come out of something like this with zero,” says banking and finance expert Don Coker, though.
“Obviously I feel sorry for anyone who loses such an investment, but … they should be aware of the risk,” he added. (AFP)
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