Amid the series of centralized crypto bankruptcy, too much shady stuff are coming forward. First, the FTX misused customer funds for trading, Celsius Network was insolvent and much more. Recently, the US Bankruptcy Examiner reported that the Celsius Network was insolvent and acting as a Ponzi scheme since its inception. And CME Institutions, are one of the major groups of traders with high volume, and according to recently reported data almost all of the CME Institutions have gone long in the market with little to zero short positions and historically it is seen only before the 2020 bull run.
1. Celsius Network was Ponzi Scheme since its Inception: Bankruptcy Examiner
In the recent report of the bankruptcy examiner in the Celsius Network bankruptcy case has presented a report of over 600 pages, disclosing some of the shady facts about Celsius Network, how it worked as a Ponzi scheme since its inception, and how they have looted the retail investors. It was so shocking to see things mentioned in the Celsius network, things like the Ponzi CEL token, discussions between the Celsius Network regarding the implementation of CEL token manipulation, and many more things.
According to the report, Celsius Network started using new customer funds to fulfill the withdrawals of previous customers as well as for the reward program. So, the simple explanation – consider two Celsius customers Joe and Alice, Joe is the customer for six months with a deposit of $500 USDC and Alice has just opened an account at Celsius Network and deposited some BTC to earn yield over it. Now behind the curtain, Celsius Network immediately used Alice’s BTC as collateral and borrowed stablecoins in order to enable withdrawals for Joe. Sounds like a traditional Ponzi scheme, isn’t it?
And adding to the craziness, the company used those funds to pay founders as well as employees with native CEL tokens. And it is reported that the founder Alex Mashinsky, who publicly talked about not selling CEL tokens, had sold over $68 million from the beginning to the end! And the company was in $600 million losses due to failed investments like Grayscale and others. Having losses is not criminal but not presenting them to investors is! Celsius Network has never reported those losses and made them public, and kept retail as well as other investors in dark.
Trust me, there are many more things that are impossible to cover in this short bulletin, although I have covered most shady stuff, there is a lot more. If you are interested to learn more about the dark stuff of Celsius Network then check out the entire report (linked below) or check out this 13 min podcast episode by Decrypt which covered the topic –
Bankruptcy Examiner Report - Bankruptcy Examiner Report (Celisus Network).pdf (stretto.com)
Decrypt Podcast - GM from Decrypt (Damming 700-Page Report on Celsius's Alleged Crimes)
2. CME Institutions are All Long in the Market, just like Before the 2020 Bull Run!
CME institutions are some of the largest players in the trading space, they combinedly cover a significant amount of trading volume which could drive the market. One more important reason to always have an eye on these CME Institutions' trading positions is that they represent the sentiment of the institutions in the market and probably the movement of the market.
According to the above chart, the CME institutions have closed almost every short position and they are all long in the market. And if you can see the green markup, which shows the same positions were placed by the CME institutions right before the 2020 bull run. It is also important to notice that, there was a significant time period (can say accumulation period) for the market to take off after CME institutions went all along, in 2020.
It is important to consider that this might be nothing, but we cannot ignore the fact that most of the institutions are taking a long take here. Even though it is not true that history repeats itself, especially in trading markets but humans do! So, let’s see how things roll out, will be really interesting to see how the market takes this and reacts to it.
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Thanks for reading!