Celsius Network, a cryptocurrency lending firm, announced on Monday to pause all withdrawals and transfers between accounts due to "extreme market conditions", in the latest sign of pressure in the crypto industry.
Following Celsius's news, Bitcoin (BTC) fell more than 6 per cent to a new low of $24,888, an 18-month low. Likewise, Ethereum (ETH), the second-largest cryptocurrency in the world, fell more than 8 per cent to $1,311, its lowest level since March 2021.
"We are taking this necessary action ... in order to stabilise liquidity and operations while we take steps to preserve and protect assets," the company noted in a blog post.
.@CelsiusNetwork is pausing all withdrawals, Swap, and transfers between accounts. Acting in the interest of our community is our top priority. Our operations continue and we will continue to share information with the community. More here: https://t.co/CvjORUICs2— Celsius (@CelsiusNetwork) June 13, 2022
Celsius Network is a major player in crypto financing, having raised $750 million in funding late last year.
The company further said that they understand that this news is difficult. "But we believe that our decision to pause withdrawals, wwap, and transfers between accounts is the most responsible action we can take to protect our community. We are working with a singular focus: to protect and preserve assets to meet our obligations to customers," Celsius said in its blog post.
Celsius Network offers interest-bearing products to customers who deposit their cryptocurrencies with the company and lends out cryptocurrencies to earn a return.
"Our ultimate objective is stabilising liquidity and restoring withdrawals, Swap, and transfers between accounts as quickly as possible. There is a lot of work ahead as we consider various options, this process will take time, and there may be delays," Celsius Network statement added.
In recent months, crypto markets have been under pressure, sliding alongside other so-called risk assets as interest rates throughout the world have increased.
Interestingly, the cryptocurrency market got spooked further, with the US inflation rate reaching a 40-year high of 8.6 per cent and falling on Monday.
The global crypto market capitalisation crashed by 6.63 per cent to $1.04 trillion as of 11.00 am. However, the global crypto volume due to increased liquidations was up by 28.47 per cent to $94.06 billion, as per Coinmarketcap data.