Celsius Crypto: Worthy Investment Or Risky Business?

Celsius (CEL) is a cryptocurrency that has been billed as one of the crowning glories among crypto assets. It is an all-in-one banking and financial service platform for crypto users. It was founded in 2017 in London and is currently ranked 555th in the crypto market. Celsius has a unique business model that lowers the risk associated with trading crypto. It also offers a range of features such as no withdrawal limitations, fees, or lockup periods. However, it has faced some setbacks, including liquidity issues and bankruptcy. So, is Celsius a good investment?

Celsius' unique business model

Celsius Network is a platform that allows users to buy, borrow, and pay in over 30 cryptocurrencies. It acts as a hybrid between a savings account and an investment portfolio, offering a lower-risk, uncomplicated way for beginners and long-term investors to buy and hold crypto while earning steady returns. The platform is available in over 100 countries and provides instant, fee-free payments via its CelPay feature.

Another key aspect of Celsius' business model is its revenue distribution structure. The company returns 80% of its revenue to depositors as weekly dividends, while the remaining 20% is utilised for business operations. This approach incentivises net deposits and fosters an impressive net deposit growth rate. Celsius also has a 4-tier loyalty program that offers bonuses and discounts on interest rates based on the percentage of the user's portfolio held in CEL tokens.

The CEL token itself serves a dual purpose. It functions as a security, enabling the company to raise funds through token sales, provide collateral, and facilitate lending. Additionally, it is used to pay weekly dividends to depositors in the form of buybacks. The CEL token also acts as a utility token, helping depositors earn higher interest on their crypto asset deposits.

Celsius' business model has been described as "genius," transforming depositors into shareholders and creating a sustainable revenue distribution system. However, it is important to note that Celsius has faced criticism and legal scrutiny for its operations, with a U.S. bankruptcy examiner report indicating that their actual business practices differed from their advertised model.

The Celsius wallet

Celsius offers a 4-tier loyalty program that provides different interest rates and benefits based on the percentage of the user's portfolio held in CEL tokens. The tiers are Bronze, Silver, Gold, and Platinum, with the Platinum tier offering a 35% bonus on earnings and a 30% discount on loan interest rates.

Overall, the Celsius wallet provides a secure and user-friendly way for individuals to store and manage their cryptocurrency assets, earn interest, and make transactions.

The Celsius token

Celsius offers a lower-risk, less complicated way for both beginners and HODLers to buy and hold crypto while earning steady returns on their investments. All deposits are insured up to $100 million and there are no withdrawal limitations, fees, or lockup periods.

Celsius uses a 4-tier loyalty program. Your tier is determined by what percentage of your portfolio is in CEL tokens:

• Bronze Tier: Less than 5% of your portfolio is in CEL tokens
• Silver Tier: 5%-10% of your portfolio is in CEL tokens
• Gold Tier: 10%-15% of your portfolio is in CEL tokens
• Platinum Tier: 15% or more of your portfolio is in CEL tokens

Each tier comes with different perks and interest rates.

Celsius has been experiencing a bearish trend after reaching its all-time high of $8.02 in June 2021. As of 16 September 2024, the current price is $0.1773, down by 97.81%.

According to Wallet Investor, with a 5-year investment, the revenue is expected to be around +271%. Your current $100 investment may be up to $371 in 2029.

The impact of bankruptcy

Firstly, the bankruptcy has resulted in Celsius customers losing access to their funds, with the company freezing withdrawals, swaps, and transfers. This has affected hundreds of thousands of customers, with reports of $4.2 billion being frozen for 600,000 Americans. The bankruptcy has also led to uncertainty and concern among customers about the safety of their funds.

Secondly, the bankruptcy has revealed issues with Celsius's business model and practices. There have been allegations of misleading customers, with the company's founder, Alex Mashinsky, accused of defrauding customers by promoting Celsius as a safe investment option while engaging in risky investment strategies. The company has also been criticized for its use of lengthy and ambiguous terms of use, which have been interpreted as granting Celsius ownership of customers' funds. This has had a significant impact on customers' ability to recover their funds, as they are now considered unsecured creditors.

Thirdly, the bankruptcy has led to a decline in the price of Celsius's native token, CEL. The token's price has seen a significant decline, dropping from an all-time high of $8.0233 in June 2021 to around $0.1773, a decrease of 97.81%. While the price did see a temporary increase of 100% due to interest from other companies, it has since continued to fluctuate and remains low.

Finally, the bankruptcy has resulted in a loss of confidence in Celsius and the wider crypto market. Celsius's collapse, along with that of other crypto firms, has highlighted the risks and instability of the unregulated crypto industry. This has led to increased scrutiny and a potential shift in how crypto companies operate, with a focus on protecting customers and their assets.

Overall, the bankruptcy of Celsius has had far-reaching consequences, impacting customers, the company's operations, and the wider crypto market. It has raised questions about the safety and stability of crypto investments and the need for better regulation and customer protection. While there are efforts to return assets to customers and restructure the company, the full impact of the bankruptcy is still unfolding.

Long-term Celsius price predictions

Celsius (CEL) is a cryptocurrency that has experienced a bearish trend after reaching its all-time high of $8.02 in June 2021. As of September 2024, the CEL token is trading at around $0.12 to $0.20, which is a significant decline from its previous highs.

Looking at long-term price predictions for Celsius, there are varied forecasts from different sources:

• According to one source, the CEL crypto price prediction for 2025 suggests a minimum, average, and maximum value of around $0.51, $0.62, and $0.73, respectively. By 2027, the price of CEL is expected to soar to a maximum of $1.21, making it a potentially profitable investment.
• Another source predicts that the price of CEL will continue to rise in the long term, with a potential high of $2.61 by 2030. However, it is important to note that this source also mentions that CEL is a bad long-term (1-year) investment, and the current investment may be devalued in the future.
• A third source predicts that the price of CEL will reach $0.742 by August 2029, representing a long-term increase of 271%.
• A fourth source makes a bearish prediction, forecasting that the price of CEL could drop to $0.183 by the end of September 2023.

It is important to remember that cryptocurrency markets are extremely volatile, and price predictions often turn out to be wrong. As such, it is recommended to do your own research and never invest more money than you can afford to lose.

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