“Homeless, suicidal, down to last $1,000: Celsius investors beg bankruptcy judge for help.”
Wait a second. I thought a main motivation in “investing” in crypto “currency” was to get away from government and government regulation. Now, that the unregulated scheme took “investor” money they are asking that same government they were avoiding to bail them out?
“Celsius is down to $167 million ‘in cash on hand’, … owes its users around $4.7 billion… and has more than 100,000 creditors”
I would not count on the government and government regulation shunned by crypto “investors” to bail out the users “owed” $4.7 billion. If crypto “currency” is truly an “investment” then we all know there is risk of loss in investments. I remember many friends boasting about how crypto is not regulated and that was an advantage. Even Coinbase’s general counsel boasts how “Coinbase does not list securities. End of story.”: HTML.
Also some of the creditors “lent the platform cash without any collateral to back up the arrangement.” Please read the CNBC article linked below for even more dubious fine print in the Celsius agreements signed by retail investors hoping to get rich quick without government involvement. Regardless, “it is unclear whether customers will ever see their money again.”
“I believed in all the commercials, social media and advertising that showed Celsius was a high yield, low risk savings account. We were ensured that our funds are safer at Celsius than in a bank, This money is pretty much my life savings.”
Bank deposits are regulated and FDIC insured: HTML. Traditional brokerage accounts are regulated and SIPC insured: HTML. Crypto accounts are neither regulated (that’s how everyone wanted it right? – less government) nor insured. Well, regulation is on the way, but as of right now, not so much. So I don’t get why anyone would think funds are safer on a crypto platform than a regulated and insured account at a bank or brokerage.
I understand inflation is high driving up the cost of everyday goods and services. I understand folks are looking for ways to amplify their returns. But ignoring basics of regulation and insurance, and leveraging your life savings, in hopes of amplifying returns at best or getting rich quick at worst, is a recipe for the disasters we now see.
Several quotes come to mind: “slow and steady wins the race”, “be patient and move slowly to avoid mistakes”, “Truth is confirmed by inspection and delay, falsehood by haste and uncertainty”, “Dishonest money dwindles away, but he who gathers money little by little makes it grow.”, and “JOMO – Joy Of Missing Out.”
I hope those reading this post also read the CNBC article linked below. Also check out the recent NPR article “Amid the hype, they bought crypto near its peak. Now they cope with painful losses.”: HTML. Then sit down with a licensed and trusted financial advisor to map out a plan to recover if you lost money in crypto or continue to “gather little by little” if you avoided crypto and now experience JOMO.