How crypto lender Celsius Network stumbled on risky bank-like investments

Stacks of bitcoins sit near green lights on a data cable terminal inside a communications room at an office in this arranged photograph in London, U.K., on Tuesday, Sept. 5, 2017. Photographer: Chris Ratcliffe/Bloomberg

Celsius Network, the retail crypto lending platform whose liquidity problems have sent cryptocurrencies plunging, stumbled on complex investments in the wholesale digital asset market in what analysts say was akin to a traditional bank run.

Citing extreme market conditions, New Jersey-based Celsius this week froze withdrawals and transfers between accounts “to stabilise liquidity”. In a video on Friday, the company’s finance chief said Celsius, along with the industry, had seen redemptions rise following the collapse of cryptocurrency TerraUSD in May.

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