Since the beginning of the month, Celsius (CEL) has repaid a significant portion of its outstanding debt to the Maker (MKR) protocol, indicating that the beleaguered crypto lending platform was attempting to aviod a total collapse despite plausible claims of insolvency.
The company’s liquidation price on its Wrapped Bitcoin (wBTC) loan has reduced to $4,966.99 Bitcoin as a result of the loan repayments (BTC). The liquidation price has reportedly dropped by nearly half since Celsius made a $64 million DAI payment on July 4, just hours after making a $50 million DAI payment.
Celsius reduces outstanding debt
According to data from DeFi Explorer, the struggling company has refunded $142.8 million in Dai (DAI) stablecoins in four distinct transactions since July 1. Maker is still due $82 million by the crypto lender. The firm’s losses are currently $667.2 million out of $1.8 billion in lifetime investments.
The firm is one of several crypto blue-chip corporations on the verge of bankruptcy due to historic losses across several holdings caused by harsh market conditions. Due to the harsh market conditions, the firm suspended withdrawals in mid-June and hired fresh legal counsel to advise on restructuring.
Ongoing struggles
According to the Wall Street Journal, Celsius has hired counsel to restructure the business in the face of financial problems.
CEO Alex Mashinsky and other Celsius executives have largely avoided social media since making that declaration. On June 19, Celsius announced that it will terminate talks on “Twitter Spaces and AMAs” to focus on resolving problems.
Soon after, rumors that the American mega-bank Goldman Sachs was interested in buying Celsius’ assets stared circulating.
According to reports, Celsius was still disbursing rewards as of last week, despite its financial problems and indications that its firm was about to implode. Users of Celsius were still receiving incentives, but because of liquidity restrictions, they could not cash them out.