Tezos Co-founder has said the bankruptcy faced by Celsius is unsurprising because such business models are sustainable in the long run.
Celsius had filed for voluntary Chapter 11 bankruptcy protection exactly a month after suspending users’ withdrawals and redemptions due to a liquidity crunch caused by extreme market conditions.
— Celsius (@CelsiusNetwork) July 14, 2022
Kathleen Brietman, Tezos Co-founder has said recent events in the crypto industry were predictable, while others were less predictable. Citing Three Arrows Capital’s insolvency, she noted that what happened to the crypto hedge fund was “uniquely bad.”
With some crypto organisations facing finacial crisis as a result of the terra crash, the co-founder believes that these are shakeouts from “things that just wouldn’t have worked.”
According to her “You really can’t make a sustainable protocol or business based on the theory that numbers will always go up, which was most wheel’s risk model going into this,” she concluded.
What to expect from this
Celsius have decided to fill voluntary petitions for Chapter 11 protection and announced that the company initiated a financial restructuring while assuring its followers tht the decision was made with the intention to provide the best opportunity to stabilize the business, consummate a comprehensive restructuring transaction that maximizes value for all stakeholders, and emerge from Chapter 11 positioned for success in the crypto industry.