After Halting Withdrawals, Celsius Transfers 250,000 Wrapped Bitcoin To FTX Exchange

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Alex Mashinsky CEO of Celsius Network
Alex Mashinsky CEO of Celsius Network

Lending platform Celsius has transferred nearly 25,000 Wrapped Bitcoin (wBTC), worth $528.9 million, to crypto exchange FTX, raising concerns from the crypto community about whether a dump may soon follow. 

The massive transfer to the exchange comes after the lending platform paid off its remaining $41.2 million of debt to Maker protocol, freeing up its loan’s entire wBTC collateral.

Nonetheless, the community is fearing that a dump of the wBTC on the exchange could soon follow, dragging Bitcoin (BTC) price down even lower.

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Others have been more positive that the move may be in preparation for Celsius to swap their Wrapped Bitcoin for BTC, which may be a good sign for depositors who’ve been hoping for Bitcoin withdrawals to eventually reopen on the Celsius platform. Bitcoin is up 8% in the past 24 hours to trade above $22,100, suggesting market participants are taking the news in their stride.

The 21,962 WBTC unlocked from paying off the remaining DAI loan has already found its way to FTX…

So far, both Celsius and CEO Alex Mashinsky have remained radio silent about any movement of funds.

Crypto lawyer Joni Pirovich, principal of blockchain and digital assets, told Cointelegraph on Thursday that Celsius’ repayment of its loan position with Maker will ultimately assist its customers.

“Maker protocol relies on overcollateralized loan positions, so the loan repayment of $41 million worth of DAI released 21,962 wBTC of capital which is now available to meet customer withdrawal requests.”

“The question is what will Celsius do with the withdrawn collateral? Keep it in reserve for customers or risk it to trade and on-lend.”