$150 Million Crypto Bet Lost at Caisse de dépôt?

Ironically, at the time of the CDPQ investment, Celsius was already in the crosshairs of market authorities in Texas and New Jersey. (Photo: Getty Images)

LES KEYS DE LA CRYPTO is a department that patiently deciphers the world of cryptocurrency, the stock market, and industrial and media turmoil. François Remy’s mission is to identify promising entrepreneurs, decode technical advances, and anticipate the industrial and societal impacts of this digital currency.

(Illustration: Camille Charbonneau)

A snag in the woolen socks of Quebecers. Believing to seize a good investment opportunity a few months ago, CDPQ bet on crypto lender Celsius Network. But today, the solvency of the partner is seriously questioned.

“A strong management team that puts transparency and customer protection at the heart of its activities,” Caisse de dépôt et placement du Québec (CDPQ) praised when the investment in Celsius Network was announced last October. A blockchain-based platform that offers a compound return service and instant loans for low-cost cryptocurrency.

Believing it is a world-class company, the investment group Quebec has injected $150 million to support C’s growth and, according to the new partners, called for it to remain an industry leader in terms of innovation and regulation. Acceptance.

denounce the bet

Ironically, at the time of the CDPQ investment, Celsius was already in the crosshairs of market authorities in Texas and New Jersey. The latter claimed that the interest in the form of a token, CEL, constituted an offer of an unregistered guarantee.

A month later, ironically, the Israeli police arrested the chief financial officer of Celsius in connection with a case of external fraud and money laundering.

Last February, fearing crypto-currency betting public money, Quebec Solidere urged Quebec’s financial policeman, AMF, to open an investigation. Meanwhile, CDPQ officials have not failed to enforce the distinction between investing in the blockchain and not directly in cryptocurrency.

Except Celsius is writing a new chapter in his history textbook today about the collapses within the cryptocurrency ecosystem.

Responsible measure… of the crisis

“Due to severe market conditions, we announce that Celsius will suspend all withdrawals, exchanges and transfers between accounts,” he informed the platform, to ensure that it does so to fulfill its obligations and defend the interests of its community, including, therefore. D warehouse.

That is, the company must recover its liquidity before restoring transactions “as soon as possible”. Noting in his passage at the end of his blog, in his disclaimer, that these are forward-looking statements that involve skepticism. A language that denotes the double crisis that the Celsius network is going through, the crisis of confidence and the crisis of liquidity. One feeds the other, and vice versa.

Celsius was hit hard by the collapse of “Terra stablecoin UST”, a stable virtual currency thanks to bumper returns, and was already angering the crypto community, who questioned its solvency.

Extraordinary movements of tokens for an amount of more than 300 million US dollars, which were observed thanks to the blockchain on the main wallets in percentage terms, then increased fears and reinforced the hypothetical scenario. If the company is moving “silently,” it is because it has cash flow problems that it has been quick to hit the crypto world on social networks. The escape certainly did not subside the suspension of transactions.

Domino effect?

The least mysterious outcome at the moment remains the sharp drop in CEL, as the coin lost 50% in the 24-hour period to quote at 21 cents.

Sometimes the misfortune of some makes others happy. Celsius competitor Nexo has already issued a takeover offer. Recognizing the implications for individual investors and society, the Zug-based company proposes acquiring part or all of the financial assets, brand elements and customer database.

asked by Business As for the financial risk incurred at a time when the solvency of the percentile raises serious questions, CDPQ has not yet had the opportunity to respond.

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