One of the former executives of the popular altcoin project claimed that Celsius deliberately manipulated the price of the CEL token.
This altcoin faces market manipulation allegations
Timothy Cradle, former director of financial crimes compliance at Celsius, has made allegations against the company. The former compliance manager claimed that the company artificially inflated the price of the CEL token. Also, Cradle said Celsius is using client funds for this. Moreover, he claimed that he was engaged in potentially illegal market manipulation.
Timothy Cradle said he overheard other company executives arguing about “pumping the CEL token” at a company’s Christmas party in 2019. According to Cradle, executives have spoken openly about it. He also said that his activities and similar conversations occurred at least twice more. The former director of financial crimes compliance released the following statement:
I don’t know of a better way to express this. But they were on the market. They were actively trading and increasing the price of the CEL token. They were definitely trading the token to manipulate the price.
Claims about Celsius are not the first
Cradle isn’t the only one familiar with the lender’s operations, which has accused the company of engaging in potentially illegal market manipulation. Earlier this month, Jason Stone, president of KeyFi, which manages over $2 billion in crypto assets on behalf of Celsius, also voiced some allegations. He first claimed that the firm did not pay KeyFi for its services and sued Celsius. In the lawsuit, Stone accused Celsius of market manipulation and running a Ponzi scheme. It also said it did not implement basic accounting controls or risk management practices. In addition, they alleged that he had engaged in numerous harmful and illegal business practices.
“The most egregious example of this was when Plaintiff discovered that Celsius was using customer Bitcoin deposits to inflate his own crypto-asset called the ‘CEL token’,” the lawsuit states. Stone also accused the lender of using double-digit interest rates on its deposit accounts to “attract new depositors” and use those funds to repay previous depositors and creditors. He also accused him of running an effective Ponzi scheme.
Will altcoin customers be able to get their money?
Craig’s claims come days after Celsius filed for Chapter 11 bankruptcy in New York. cryptocoin.comAs you follow, this filing revealed a $1.19 billion gap in Celsius’ balance sheet. Also, the documents show Celsius owes its customers $4.72 billion.
Unfortunately for them, the lender’s terms of use are replete with clauses against customers. For example, the contract states that customers transfer ownership of their cryptocurrencies to the lender. It also states that in the event of liquidation, they can be treated as unsecured creditors. In other words, the firm’s clients are likely to never see their funds again.
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