Celsius Loan Liquidation Caused ‘No Losses to Tether’

USDT announced its BTC loan to Celsius was paid in full — and then some

article-image

Source: Shutterstock

share

key takeaways

  • Tether concedes its portfolio still includes a “minimal” investment in Celsius
  • The company did not indicate when the loan was taken out — or how much of the collateral was lost during bitcoin’s recent slide in value

The company behind the stablecoin Tether on Friday unveiled fresh details around its loan to embattled crypto lender Celsius — saying the margin calls and ensuing liquidation resulted in “no losses.”

That’s because, according to the company, the bitcoin loan was overcollateralized to the tune of 130%. 

Tether first said its Celsius loan liquidation June 15 left the company with “no exposure to Celsius” outside of its equity investment in the digital assets lender. 

The company did not indicate when the loan was taken out — and how much of the collateral was lost during bitcoin’s recent slide in value. The loan was made whole, per Tether, and USDT even returned a portion of the collateral to Celsius.

Tether appeared to take a shot at Celsius and Voyager’s lending practices.

“While the media, critics and community were wrongly fixated on Tether, other lenders including notable names in the space were blatantly providing lending facilities with nearly zero collateral,” the company wrote. Both Voyager and Celsius were found to have made undercollateralized loans after freezing customers’ accounts.

Tether restated it holds a “minimal” investment in Celsius, which it claims does not have any bearing on USDT’s reserves or stability. 

“Critics who make claims of Tether’s inconsistencies clearly have no understanding of how lending, borrowing, and management work,” the company said. 

A spokesperson for Tether declined to comment on the specific timeline of the loan, including when it originated.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Frax report cover.jpg

Research

Frax saw continued development in its frxETH liquid staking derivative and Fraxlend money market throughout 2023. Frax V3 introduces an RWA strategy to drive utility to the protocol's cornerstone product, the FRAX stablecoin.

article-image

Customers of the bank’s crypto service have until Dec. 19 to migrate their holdings to Blockchain.com

article-image

As of Wednesday, the US government had seized Sinbad’s website

article-image

Cross-chain protocol’s product development-focused unit Wormhole Labs formally launches following $225 million raise

article-image

Accredited and non-accredited investors worldwide will be able to purchase the Note starting Dec. 6 on US-regulated trading platform INX

article-image

Bitcoin’s next halving is less than five months away. History says they’re bullish but will this time be different?

article-image

Merger is set to allow the combined business to “flex between our different lines of business,” Hut 8 CEO says