C Network faces investigations from regulators across five states over its recent decision to suspend withdrawals from customers' accounts.
Following the decision to suspend the withdrawal, Network C is now facing an investigation from state securities regulators. According to Joseph Rotunda, director of enforcement for the Texas Securities and Exchange Commission, officials met and decided on the investigation and would make it a "priority." Rotunda also said:
"I am very concerned that clients – including many retail investors – may need immediate access to their assets but may not be able to withdraw money from their accounts. The inability to access their investments can lead to significant financial consequences."
Rotunda said the issue with Celsius and customer withdrawals first came to his attention on Sunday through the company's blog post and Twitter.
The Celsius network is cooperating with ongoing investigative procedures
In addition, the Rotunda also stated that Celsius has cooperated with regulators.
However, the investigation is still in its early stages. Furthermore, the texas Securities and Exchange Commission's director of enforcement added that the Securities and Exchange Commission (SEC) has been in touch with Celsius about the matter.
Reuters has reached out to the parties for comment on the ongoing investigation. Some refused, while others did not respond at press time. On the other hand, the Kentucky Department of Financial Institutions said responding to an ongoing investigation was contrary to the agency's policy.
Celsius account frozen
A few days ago, Celsius announced that it had frozen activities such as swaps, transfers and withdrawals due to "harsh market conditions". This comes amid a broader cryptocurrency sell-off that is maintained, with the cryptocurrency lender saying it decided to "stabilize liquidity and operations". Furthermore, Celsius tried to justify the suspension, calling it "the most responsible action we can take to protect our community."
See also: https://ecoinomic.io/tin-tuc/dieu-gi-da-khien-celsius-lao-doc.html
After suspending withdrawals, Celsius also appointed banking giant Citigroup and a law firm to advise on possible solutions. Furthermore, the cryptocurrency lender also received an offer from cryptocurrency platform Nexo to acquire Celsius' remaining eligible cryptocurrency assets.
Due to this situation, Celsius could face a class action lawsuit led by BitBoy Crypto . However, the lawsuit may have to wait until Celsius declares bankruptcy. BitBoy Crypto founder Ben Armstrong said that Celsius will not allow him to withdraw money from the platform. Armstrong also added that in order for him to have access to his fund, he must first send more money to Celsius. A squeak by the famous YouTuber read:
"[Đại diện tài khoản của chúng tôi] Tell us that we have enough money in the account to pay a loan. But we can't use the money in our account. WE HAVE TO SEND MORE MONEY TO RETURN IT. ”
"Imagine a company defaulting on debt that you can't withdraw money from asking you to SEND THEM MORE MONEY," Armstrong added.
Last November, the regulators of Kentucky, New Jersey and Texas issued cease-and-desist orders for degrees C. According to regulators, Celsius' interest-bearing products should be registered as securities.
