Ethereum: Nexo and BlockFi not exposed to stETH – A reassuring announcement after that of Celsius
Not to be put in the same bag – June 13, 2022, Celsius Network said to be in difficulty under current crypto market conditions. After this announcement, the loan service (lending) of Celsius has decided to to block all withdrawals, exchanges and transfers. Celsius’ main competitors, such as BlockFi and Nexoheld to to reassure their investors following this announcement.
Less Exposed BlockFi and Nexo Avoid Drama
According to some crypto analysts, the liquidity crisis that Celsius is currently experiencing would be due to its significant exposure to stacked ether (stETH). Indeed, a study of Celsius wallets, carried out by larry cermak (The Block’s VP of Research), says Celsius owns at least 409 170 stETH.
However, recently stETH has been facing liquidity problems on Curve Finance, a decentralized exchange. On this platform stETH is exchanged for ETH usually in a ratio of 1:1. This ratio became imbalancewhich had the effect of creating a liquidity crisis for Celsius.
In addition, The Block’s director of research, Eden Aduhas explained :
“Celsius owned so many stETH tokens that it is almost impossible to convert them back to ETH without finding a counterparty via an over-the-counter market. »
Very quickly, the competitors from celsius preferred to reassure Investors. They then asserted that they were not, or very little, exposed to stacked ether. Indeed, the CEO of BlockFi, Zac Princeclaimed on Twitter that his company had absolutely no exposure to stacked ether.
At the same time, Kiril NikolovDeFi analyst at Nexo, said the company does not hold “only a limited number of stETH”.
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Nexo wants to help Celsius and its investors
After the suspension of all withdrawals from the Celsius network, announced on Monday, its main competitor Nexo offered a repurchase of loans of Celsius. As such, a Nexo representative said to throw this lifeline at Celsius. Indeed, they “are aware of the repercussions for investors and the crypto community”.
Thus, in an open letter, Nexo made a formal offer to acquire the eligible assets and absorb all of Celsius’ loans. The consideration of this offer for Nexo would be the gain of the Celsius customer database. However, as of the day of writing, Celsius has rejected the offer made by Nexo. Celsius has until June 20 to possibly change your mind.
Finally, Nexo claimed that its financial situation was without risk. During an interview given to Coin Telegraph, Nexo declared that it was very transparent:
” [Nexo a été] the first cryptocurrency lender to publicly disclose its real-time books last September, and we have called on all of our competitors and responsible cryptocurrency platforms to follow our lead. »
To conclude this article on a more optimistic note, it is worth recalling that Nexo launched a encrypted Mastercard for the payment of services in cryptocurrencies, last April.
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