Crypto Community Confused as Celsius Continues to Pay Weekly Rewards

Members of the crypto community on Twitter are baffled by the troubled Celsius Network, which is still paying out weekly rewards even though the network suspended withdrawals two weeks ago.

As previously reported, cryptocurrency lending platform Celsius suspended withdrawals on June 13, citing the extreme market conditions of the current bear market. Reports followed that the company was facing liquidity issues and could be heading for bankruptcy, potentially putting users' funds at risk.

On June 27, Simon Dixon, CEO and co-founder of Bitcoin OG, online investment platform BnkToTheFuture, and others tweeted to his 59,300 followers that he had received nearly $4,000 worth of cryptocurrency rewards, But he was unable to withdraw money, which confused him.

"I got an email on one of my accounts. Can't withdraw money, but Celsius Network is still paying rewards. I'm curious if you guys think you'll still be getting rewards? Any ideas?"

Searching for "Celsius is still paying" on Twitter, countless users questioned the lending platform, "CryptoStylesUSA" and others said that Celsius continued to pay weekly rewards, but "seized their cryptocurrency" as an "insult" to them .

According to Celsius’s website — which is currently being updated due to liquidity issues — the company is still touting an annualized yield (APY) of 18.63% on cryptocurrency deposits, which many believe is unsustainable.

SNX, the native token of decentralized finance (DeFi) platform Synthetix, is the only asset advertised with the highest APY at the time of writing. The APY of the top stablecoins shows around 9%, while Polkadot and Polygon offer APYs as high as 11.87% and 9.52%, respectively.

Celsius still appears to be offering a 10% bonus on first-time deposits of up to $250,000, although withdrawals from the platform are currently not allowed.

While the exact fate of Celsius users’ funds is currently uncertain, the company reportedly hired consultants from a management consulting firm before the company could face bankruptcy. Celsius also hired lawyers on June 14 to help the company restructure amid financial distress.

On June 27, rumors surfaced that Celsius CEO Alex Mashinksy attempted to leave the country through Morrison Airport in New Jersey, but was stopped by authorities. The rumors appear to have come from cryptocurrency analyst Mike Alfred, however, the firm has reportedly denied the allegations.