Celsius Network LLC, a major U.S. cryptocurrency lending company, suspended withdrawals and transfers citing “extreme” conditions, during a downturn affecting the prices of bitcoin, Ethereum and other currencies.
“We are taking this necessary action for the benefit of our entire community in order to stabilize liquidity and operations while we take steps to preserve and protect assets,” the company wrote in an announcement on Sunday evening. “Furthermore, customers will continue to accrue rewards during the pause in line with our commitment to our customers.”
The company stated that it was suspending withdrawals, token swaps and transfers between accounts in order “to protect and preserve and protect assets to meet…obligations to customers” and stabilize liquidity and restore withdrawals quickly.
The price of Celsius’s native token crashed shortly after the news, falling 50% within an hour from a high of $0.47 to $0.23 at 8:30 a.m. EST, according to CoinMarketCap.
The rest of the crypto market ecosystem has seen similar drops in price as bitcoin fell 18% to $ 22,836, an 18-month low and Ethereum also fell 20% to $1,112, its lowest since January 2021. The cryptocurrency Cardano fell 14% to $0.45, Solana fell 19% and the meme currency Dogecoin fell 21%.
Amid the volatility, the world’s largest crypto exchange, Binance is also having its own issues. According to a tweet from the company’s Chief Executive Officer Changpeng Zhao, withdrawals have been suspended due to a transaction suspended causing a backlog.
The initial tweet claimed that the problem would be fixed within 30 minutes, however, shortly afterward he sent out another message that stated it would take longer. The issue surfaced at 8 a.m. EST and has still not been resolved.
According to Zhao, it only affects bitcoin network withdrawals He also added that the funds themselves as SAFU, meaning that they are protected by the Secure Asset Fund for Users emergency insurance fund that the exchange established four years ago.
This is unrelated to market volatility that caused Celsius to pause all withdrawals and transfers on its platform. However, it has locked users out of the ability from trading in the main bitcoin network from trading directly during the market downturn on the exchange.