#CelShortSqueeze Pumps $CEL Token 100% in 9 Days

Credit: CoinGecko

Is #CelShortSqueeze just another meme?

Meme culture defines crypto twitter and crypto by default. If a picture is worth 1,000 words, a catchy meme is worth 1,000 retweets.

GameStop was more “meme-y” than Celsius. Some big players — Ryan Cohen, Elon Musk, true “Meme Kings” — were involved with GME and that hasn’t happened with Celsius yet. Perhaps if more attention were brought to the cause, we could get similar attention and traction.

But right now, we don’t need memes, the numbers speak for themselves and the attention is coming. The squeeze is working. Look at the price chart; since withdrawals were halted, we’ve had three “mini-squeezes” already.

CEL token is back above $2, more specifically $2.11 at the time of writing, up 100% in 9 days, from $1.10 to $2.10. We’ve had featured write-ups in Forbes, Yahoo Finance and CoinDesk — the latter of which has 2.9 million followers on Twitter.

How did the #CelShortSqueeze begin?

The #CelShortSqueeze began as a grass-roots “revenge of the shorts” trade by those in the Celsius community that suffered liquidated CEL-backed loans.

We can trace its origins to @Otisa502 on Twitter, a prominent member of the Celsius Community, who published this thread that went viral on June 15th, claiming “this is GameStop, AMC and Wall Street Bets all over again (the sequel.)”

This inspired my first Medium article a mere five days later: “The Case for the #CelShortSqueeze — GME 2.0?” CEL token pumped to $1.50. We’ve been squeezing ever since.

Credit: @otisa502

What is #CelShortSqueeze?

Recognizing the trade opportunity on the heavily shorted, illiquid token, the Celsian Community rallied together in the form of the #CelShortSqueeze hashtag on Twitter — spending their own money to buy CEL and keep the token from going to zero, which is exactly what the short-sellers are trying to accomplish on FTX.

People around the world have strong emotional and financial ties to Celsius. They refuse to stand by while it’s attacked without doing something about it. That “something” is the #CelShortSqueeze.

Celsius owns more than half of the CEL tokens in existence, anywhere between 320 million to 350 million.

The majority of CEL token, over 93%, has been locked since Celsius halted withdrawals on Sunday, June 12, 2022. The current FTX CEL supply is 3.7 million and current spot shorts on FTX are 2.7 million.

If the CEL token price increases to $4+, while this may just be cosmetic on the company’s balance sheet, because CEL is a low-liquidity crypto, Celsius could possibly get a loan from a third-party entity against their Treasury, as an example, or it may give a third-party entity confidence to help bail out Celsius, since the Treasury would be worth approximately $1.3 billion at a CEL price of $4.

This means the hole in Celsius’ balance sheet is eradicated on paper, and this will certainly help depositors — along with any Plan/Proposal that Celsius comes up — get access to a percentage of their funds again on a tbd basis.

And hey, maybe they can make some money on the trade and REKT some shorts in the meantime for their efforts.

Credit: @GoodLyfeAddikts

How does the Chapter 11 Filing affect #CelShortSqueeze?

We believe the Chapter 11 filing furthers the case for the #CelShortSqueeze. Prior to the filing, there was a fear that Celsius could undo withdrawals at any time. Now with the Chapter 11 filing, any withdrawals and/or swaps are halted indefinitely until the restructuring process is completed. This simply means that CEL will continue to be an illiquid token for the foreseeable future.

Furthermore, Chapter 11 is not Chapter 7, meaning this is not worst-case scenario. While the future of Celsius is uncertain, the company is still working to find a sustainable solution to stay in business and continue as a going-concern with its Chapter 11 reorganization plan.

Credit: @CoinDesk

Comparing #CelShortSqueeze to GameStop

What they have in common: The narrative. The big bad trader/exchange/Wall St. type vs. the little guy/retail trader.

For most of us, the #CelShortSqueeze is personal. Most participants have funds locked on the Celsius platform, many others have had substantial CEL-backed loans liquidated. A lot of money is at stake for a lot of people.

While no one wanted to see GameStop go out of business, most people would not have lost their life savings if they had to close up shop for good. GME needed a complete restructuring, and with Ryan Cohen at the helm and a dedicated community of supporters, what began as a “wreck-the-shorts” short squeeze turned into a self-fulfilling prophecy of sorts. GameStop has done a complete 180, just launched its own NFT platform and is doing better than ever.

Can we manifest the same future for Celsius? We sure hope so. But Celsius is not an old video game retailer with an archaic business model. Celsius is a multi-faceted lending platform with other interests as well, including Bitcoin mining.

Another difference that’s very important to note is that people who purchased $GME shares became shareholders in GameStop. Please keep in mind that’s not the case with purchasing CEL.

Credit: @Jamers2012

What will the “Squeeze” look like?

Long positions are capped at losing the capital they invested, while shorts can potentially incur an infinite loss.

Spot shorts are paying a fluctuating but high APY% (currently 2,599% on FTX) to keep their positions open. Eventually, they will need to close their positions.

#CelShortSqueeze is working. CEL token liquidity is leaving exchanges every day to private, self-custody wallets. When CEL liquidity inevitably dries up on exchanges like FTX, spot shorts will be forced to go to DeFi to purchase CEL to cover their short positions.

This is where we “control” the price. Most of the community has limit sell orders set for $100 per $CEL token on 1inch, which is a DeFi aggregator DEX (decentralized exchange). There will be a quick spike in price. It will happen very fast. A/K/A Squeeze.

Thought the GameStop documentaries were interesting? Just wait for The #CelShortSqueeze Story. Between the macro uncertainty, players involved and general volatility associated with crypto, that’s one Netflix special you won’t want to miss.

Jade aka #MotherofGreenCandles

I’m an investor devoted to all things web3. Follow me on Twitter!

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Jade

Jade

My journey towards crypto-life balance. Not financial advice. My opinions only.