Last Updated on July 14, 2022 by Bitfinsider

The entire cryptocurrency market crashed into a huge, dismal abyss following the Celsius Network’s move last month to suspend all transactions and withdrawals.

This week brought some positive news as Celsius settled its $41.2 million debt to the MakerDAO DeFi protocol. Celsius was able to release $448 million in collateral as a result of this payment.

However, it seems that this will be the U.S. crypto lender’s sole noteworthy advancement in the ensuing weeks or months.

Following speculation and rumors for several weeks, Celsius’s legal representatives have now officially notified authorities that the cryptocurrency lender has applied for Chapter 11 bankruptcy protection.

CEL Loses Half of Its Value Following Insolvency News

CEL, the native cryptocurrency of Celsius Networks, dropped half of its value after the bankruptcy was announced, dropping from an intraday high of 95 cents to 45 cents.

There has been an uptick in cryptocurrency-related failures during the past month. Celsius is the third cryptocurrency company to file for bankruptcy, following the cryptocurrency hedge fund Three Arrows Capital and the cryptocurrency lender Voyager Digital.

Due to what appears to be a fever brought on by futures and derivatives traders, the price of CEL has almost doubled since June 20. CEL experienced a 456 percent increase from $0.28 on June 15 to $1.56 on June 21 compared to the market’s 12.36 percent growth during the same period.

Only $12 billion worth of assets were held by Celsius in May, which is less than half of what it had at the beginning of the year. After that, the company stopped disclosing its managed assets.

Once Upon A Time, Celsius Was A Powerhouse In The Crypto Industry

The downside pressure on CEL is still present as it is currently trading almost 80% below its $8 high from April 2018.

At its height, Celsius dominated the cryptocurrency market. It has assets worth more than $20 billion and more than 1.7 million users worldwide. Offering investors yields in the area of 18% was key to the company’s success.

Ever since Celsius stopped operating, CEL’s value has substantially dropped. However, this does not indicate that the token will go to zero. In fact, it might attract additional interest from pump-and-dump traders.

Celsius claims to have $167 million in available capital at the moment, which it will utilize to fund some operations “during the reorganization process.”

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