Celsius Update | Canadian Pension Fund Seeks Claims; Former Executive Reveals: Speculating on Platform Tokens is Unavoidable

After the first hearing on 7/18, Celsius had two pieces of news. Previously, the financier and Canadian retirement fund CDPQ stated that it would take time to address claims against Celsius, emphasizing the need to protect its own rights. CNBC also interviewed Celsius' former financial crime compliance officer, who revealed the poor risk control mechanism at Celsius and the company executives' unabashed promotion of the platform's token, CEL.

Canadian Pension Fund Previously Invested $150 Million

The Caisse de dépôt et placement du Québec (CDPQ) participated in a $400 million Series B funding round led by WestCap Investment for Celsius in October last year. After Celsius suspended withdrawals on 6/13, CDPQ declined to comment.

However, CDPQ spokesperson Maxime Chagnon stated on 7/21 in a declaration:

Celsius is going through a complex process that requires time to resolve. A small portion of our investment portfolio is allocated to startups with potential for excess returns, but Celsius did not meet expectations. We are making every effort to protect our rights and will provide further comments at the appropriate time.

Former Celsius Executive Reveals

CNBC interviewed former financial crime compliance executive at Celsius, Timothy Cradle, who candidly raised several points.

Minimal Compliance Resources

Cradle stated that the compliance team consisted of only three members from 2019 to 2021, with high compliance costs. Celsius was reluctant to allocate more resources.

Speculation and Sale of CEL Tokens

Cradle pointed out that he was shocked by the Celsius executives' discussions at a Christmas party in 2019, where they were speculating on CEL tokens, inflating token prices, and actively trading without hesitation.

CNBC quoted another former employee:

Manipulating token prices is easy due to the low trading volume of CEL. I am convinced that CEO Mashinsky knows this and it's just a case of manipulation for his own benefit.

Devilish Details in User Terms

Cradle mentioned that many users did not fully understand the user terms, contradicting Celsius' marketing slogan of "unbank yourself." According to Clause 13 of the Terms of Use, once funds are deposited, they belong to Celsius.

He made it clear that he would never deposit money with Celsius.

Lack of Transparency, Team Disarray

Cradle highlighted Celsius' severe chaos, mentioning an internal document where the team crafted a strategy, but the risk manager was completely unaware. He stated:

The risk manager might even be surprised by the existence of this document. This is the situation at Celsius, where the left hand doesn't know what the right hand is doing.

He also mentioned Celsius exaggerating and falsifying user numbers, claiming to have 1.7 million users in reports but possibly having close to 300,000 actual users, with the majority being fake accounts. However, the management was reluctant to intervene.

Cradle emphasized that this is the reality of Celsius, including the discrepancy between CEO Mashinsky's public statements and behind-the-scenes actions.