Crypto lender Celsius Network raises $400M as regulatory pressure increases
Cryptocurrency lender Celsius Network has announced that they have raised $400 million in equity funding. This development comes amidst regulatory pressure from different parties. Here’s what’s happening.
What are the details of the latest Celsius Network Equity Fund
As one of the world’s leading crypto earning and lending platforms, Celsius Network just announced that the company has raised $400 million. This investment fund is led by WestCap, a growth equity firm, and Caisse de dépôt et placement du Québec (CDPQ), a global investment group.
With this transaction, Celsius will now be valued at more than $3 billion. This is an improvement from last year where the company’s valuation was at $120 million. Celsius intends to use the proceeds from this investment for the following projects.
To expand the company’s products and offering.
The company is planning to continue building bridges between cryptocurrencies and traditional finance by launching institutional-grade products.
Some of the money will be used to double the company’s team from 486 employees to about 1,000.
To expand globally through strategic acquisitions, which will help fuel exponential growth for the company.
According to Alex Mashinsky, CEO of Celsius Network, this partnership will “further its mission to leverage blockchain technology to connect and decentralize the traditional finance.”
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As of October 8, Celsius’ total assets had crossed over $25 billion. They also have over 1 million registered customers and have paid over $850 million in interest to users through its Earn product over a three-year period.
Last year, the company raised $30 million in an equity fundraising round led by Tether. Just recently, a report showed that Tether loaned Celsius Network Ltd. $1 billion, which the company is paying back at an interest rate of 5% to 6%.
But why is Celsius in trouble?
Over the past few months, the crypto lender has been singled out by state regulators in the US in response to its lending products. Alabama, New Jersey, and Texas have accused the company of violating state security laws. In addition, Kentucky also issued a cease-and-desist order against the company.
With this new investment, the crypto lender hopes to reassure regulators of the credibility of their operations. The company also insists that its business is fully compliant with US laws.
As the pressure intensifies around Celsius Network, the company is focused on proving that its business is legitimate and opening doors for crypto in the mainstream financial market.