Was Celsius Network founder a fraudster?

NEW YORK -- The founder and former CEO of the failed cryptocurrency lending platform Celsius Network was arrested Thursday on federal fraud charges alleging that he schemed to defraud customers by misleading them about key aspects of the business.

Is Celsius a scam or a new-school crypto scheme?

"Whether it's old-school fraud or some new-school crypto scheme, it doesn't matter one bit. It's all fraud to us," U.S. Attorney Damian Williams said at a press conference detailing the charges. Founded in 2017, Celsius filed for Chapter 11 bankruptcy protection in July 2022 after customers rushed to withdraw deposits as crypto prices fell.

Why did Celsius go bankrupt?

Celsius was among the first in a series of bankruptcies in the cryptocurrency sector last year as token prices cratered amid rising interest rates and stubbornly high inflation. It filed for bankruptcy shortly after Singapore-based crypto hedge fund Three Arrows Capital and rival crypto lender Voyager Digital did likewise.

What's going on with Celsius's 'extreme market conditions' lawsuit?

Celsius had no immediate comment on the lawsuit, which seeks unspecified compensatory and punitive damages and was filed in New York state court in Manhattan. Stone's accusations follows Celsius' June 12 decision to freeze withdrawals and transfers for its 1.7 million customers because of "extreme" market conditions.