Tezos Co-Founder Says It's "Completely Unsurprising" that Celsius Will Go Bankrupt
Kathleen Brightman, co-founder of the decentralized blockchain platform Tezos, said that current events in the cryptocurrency market, such as the bankruptcy of companies, should not be surprising.
Giving an interview to Bloomberg Technology on July 15, Breitman cited the case of the Celsius crypto-lending platform, noting that a bankruptcy decision is expected in the cryptocurrency market, since some organizations are created on a weak foundation.
According to Breitman, market correction in the long run is beneficial for weeding out businesses that have no chance of survival.
Crypto Business with a Weak Foundation
She noted that the number of organizations that may collapse will increase, stating that they are based on a theory that has no practical aspect.
"It's not at all surprising that something like Celsius would go bankrupt, because there are laws in the economy that transcend the word 'blockchain,'" Breitman said.
The head also mentioned the firm Three Arrows Capital, which declared bankruptcy, noting that the company's business model was risky and doomed to failure. She called the model "uniquely bad" with no chance of survival.
Cryptocurrency Companies Are Failing
Besides Celsius and Three Arrow Capital, another crypto lender, Voyager, has since filed for Chapter 11 bankruptcy protection after significant losses.
It is noteworthy that companies such as Celsius have suffered from a market correction by resorting to bankruptcy protection. This move came just a few weeks after the freezing of withdrawals by customers due to liquidity problems.
According to Finbold, the bankruptcy filing meant that several investors lost their savings without any signs of getting their money back. Interestingly, Celsius claims that there is a chance to save the business after implementing several options, such as restructuring and dismissal of employees.
In addition to fighting for stability, Celsius is also facing a lawsuit from a former employee who claims that the company was run under a Ponzi scheme. Jason Stone's lawsuit claims that Celsius did not have enough consumer protection mechanisms, which contributed to the recent decline.
https://coin-signal.com/cryptonews/tezos-co-founder-says-its-completely-unsurprising-that-celsius-will-go-bankrupt/
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