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Crypto lending platform Celsius withdrew nearly $500 million worth of assets from the Anchor protocol during the collapse of the algorithmic stablecoin UST. Reported by The Block. According
Crypto lending platform Celsius withdrew nearly $500 million worth of assets from the Anchor protocol during the collapse of the algorithmic stablecoin UST. Reported by The Block.
According to the publication’s research department and analytics firm Hoptrail, in the past five months Celsius-controlled wallets have sent at least 261,000 ETH (~$544 million at the time of writing) to Anchor.
Their analysis and the source’s comments indicated that the company probably managed to recover the funds.
The crypto lending platform offers clients an annual interest rate of up to 17% on their assets. Until recently, the largest protocol in the Terra ecosystem allowed a 20% return on deposits in UST.
In December-March Celsius transferred 146,000 ETH to Anchor. In April and early May, the company added another 115,000 ETH deposits.
On the morning of May 11, when the stablecoin was already starting to drop, the platform pulled 225,000 ETH from the protocol. Block Research experts were unable to track the movement of the balance of assets. However, someone familiar with the situation confirmed to the broadcast that Anchor has no Celsius fund left.
On the same day, the company released a statement on Twitter:
“Establishing and using robust risk management mechanisms to ensure the security of assets on the platform is part of our commitment to serving the community. All user funds are safe.”
As part of our responsibility to serve our community, @CelsiusNetwork It implements and adheres to robust risk management frameworks to ensure the safety and security of assets on our platform.
All user funds are safe. We remain open for business as usual.
— Celsius (@CelsiusNetwork) 11 May 2022
“Celsius was relatively good as it used Bonded ETH (bETH) as collateral to borrow UST. “In the current situation, it has proven to be more reliable than buying a stablecoin in the market,” said The Block analyst Igor Igamberdiev.
He added that the platform sends the withdrawn funds in the form of stETH to the Aave loan protocol.
At the time of writing, UST prices are close to $0.1. The rate of the LUNA cryptocurrency, which is used to maintain a fixed price of $1 through arbitrage, has dropped to $0.00001 (CoinGecko).
Recall that on May 13, validators restarted the Terra blockchain for the second time in one day. Users were able to bring bundled assets like beTH to native platforms.
Source: Fork Log
I’m Sandra Torres, a passionate journalist and content creator. My specialty lies in covering the latest gadgets, trends and tech news for Div Bracket. With over 5 years of experience as a professional writer, I have built up an impressive portfolio of published works that showcase my expertise in this field.
