Celsius Network Weekly AMA– November 27, 2020
With Alex Mashinsky and Zach Wildes, Community Manager
This week’s AMA begins with some updates from Alex, followed by community questions. As always, the timestamp from YouTube is hyperlinked to each question below.
Summary: Alex starts off with the news that this past week, Celsius contributed 25,000 staked ETH as a part of the push to launch the ETH 2.0 Beacon Chain. 524,288 ETH was needed to launch, and so far over 860,000 ETH has been staked, in a beautiful moment that has been a long time coming for the Ethereum community. Speaking of big achievements—in the past year, Celsius has seen remarkable growth. Active depositors have increased from 16,000 to 80,000, total assets from $240 million to $3.3 billion, interest paid per week from $200,000 to $2.2 million, and the price of CEL Token from $0.045 to $2.50. As bad as things have been in much of the world, the crypto space has rewarded those who waited out the bear market and continued to build.
Alex also announced that Celsius has concluded an audit of assets with the firm Chainalysis. They audited all of Celsius’ transactions since 2018, and confirmed that Celsius holds over $3.31 billion in assets. Expect a press release about this sometime this week. Furthermore, in-app swaps are coming very soon, will be available to Platinum users first, and should be available to US users as well. Earning in CEL for US users is still moving forward and will likely be available in 2–3 weeks, but is still only open to accredited investors.
Finally, to honor one year since Alex began conducting weekly AMAs, he spoke more in-depth about the “Mashinsky Method” he follows as a blueprint for financial independence. The core of this plan includes having a financial plan (both for the near future and retirement) and sticking to it, eliminating high-interest debts, and to continually be growing both your assets and your knowledge by learning more. As always, Celsius isn’t only here to make a profit—they’re here to help their users and community succeed, and to do good while doing well.
And if you’d like to earn interest on your crypto, gold, and stablecoins with Celsius, scroll to the end for instructions on how to get $20 in BTC when you sign up.
Celsius Updates
- Celsius stakes 25,000 ETH for ETH 2.0. Celsius has contributed 25,000 ETH to the ETH 2.0 Beacon Chain. Back in 2017, Celsius chose to launch their token as an ERC20, and wanted to try and mimic many of the things that Ethereum as a project did right, including their amazing community. Read more about this here.
- Thankful for the dip! Bitcoin just gave you a 15% discount, ETH just gave you a 20% discount, CEL dipped down to around $2—are you buying the dip? I know I did!
- An audit with Chainalysis. Celsius has been working with Chainalysis for the past several years, and just completed an audit with them confirming that Celsius holds $3.31 billion in assets. We will be releasing a press release this week with more details
- BTC talk with Alex. There are several ways to evaluate BTC’s all-time high. We’ve already crossed the previous high for marketcap, and almost all other metrics are at all-time highs as well.
- Let’s talk about CEL. CEL has fluctuated between $2.56 and $1.96 in the past week, but has dropped much less overall than many of the DeFi “blue chips” or many of the coins in the Top 20. As any HODLer will tell you, CEL token’s price has been much more resistant to dips over the past year than most other tokens. Celsius has also been experiencing tremendous growth, and has not been afraid to be as transparent as possible with our community. In the past year, Active Depositors have gone up from 16,000 ➡️ 80,000, Total Assets up from $240m ➡️ $3.3b, Interest paid per week up from $200,000 ➡️ $2.2m, and CEL Token’s price up from $0.045 ➡️ $2.20.
- Celsius’ OTC desk is 24/7. You can send an email, get a quote (for at least $25k of CEL), and you can pay with ETH, BTC, stablecoins, or a wire transfer. We’re also offering 5% off OTC buys. Celsius is always buying dips, because we have to pay back CEL token every week. Buying OTC is a good deal for us, and a good deal for you.
- 52 AMAs, 52 lessons. We’ve been doing the AMAs for a year, and I love having a focus each week for lessons, but I’ve got a few of them this week— we’ll call it the Mashinsky Method. First, you need to have a specific plan to get to financial independence—how much money do you need to get there? Second, you need to know what your bills are. Third, you should never have credit card debt! Fourth, you should save money and watch your assets grow. Five, plan for retirement. Six, never stop learning. And our last rule—manage your risks. Fortunately, you can easily take less risk earning high yield on stablecoins with Celsius because there is so much inefficiency in the crypto markets right now.
- A nice bonus for Platinum CEL holders. In-app swaps are coming, and platinum members will be the first ones to have access to it. There will be no fees for this, and you will be getting spot price—with no built-in spreads!
- The danger of overreaching for yield. We see this with our competitors—because they need to try to reach to match our yield, because we’re already working with the biggest players, they work with smaller, riskier firms and sometimes that can backfire. Just like in DeFi, if you go and use new, unaudited projects, you might get higher yields but you also might take a big loss.
Community Questions
Q: Will US users be eligible to use the in-app swaps?
Alex: I don’t think there should be a problem. We may have a few restrictions, but nothing major for US users to use the services.
Q: What defines a wallet versus an active user?
Alex: We have about 235,000 people who have registered with us, but if their balance is less than $10, we don’t count them as an active user. We want to give you both numbers so you know how many people are signing up, but also how many people are currently using the platform.
Q: Can we get a page on the website that shows feature availability for each state and country?
Alex: So one reason we choose not to do this is because of the competitive advantage—many of our competitors don’t follow regulations, and so they could see where we aren’t offering services and then go advertise there. We don’t want to take all of the hard work that we’ve done to get licenses, and to find partner banks in jurisdictions where it’s required, and give that information away for free to our competitors.
Q: Can you give us an update on US earning in CEL?
Alex: Yep, it should be coming in 2–3 weeks—if you’re an accredited investor in the US, you should be able to earn in CEL.
Q: Can I open a Celsius account for my one-year old?
Alex: So, our compliance team is not providing sub-accounts yet, but we are working on that, and will have them sometime next year.
Q: How many users earn in CEL each week? How much CEL is Celsius buying back?
Alex: We publish those numbers every week—I think the most recent one was 47% earning in CEL and over $1 million in CEL purchased.
Q: What are the top 3 assets held in Celsius by users?
Alex: It’s definitely BTC, ETH, and CEL token.
Q: Could you explain how reverse margin calls on our loans work?
Alex: Sure, a reverse margin call is a good thing. It means you made the right decision to not sell your assets, you took a loan against it, and the asset went up in value. Your collateral is worth more, so you can either release some of the collateral or increase your loan size. When your assets are released back to you, they’ll be earning interest again.
Q: Can Celsius scale when BTC is at $100,000?
Alex: Of course, we haven’t really seen demand change based on price. If anything, as price goes up, we’ll see higher demand for market-making and arbitrage from institutions.
Q: Alex, are you going to sell Celsius to PayPal or Square?
Alex: If someone comes to us and wants to integrate or partner with us, we love doing that. If someone bigger than that comes to us and tells us that they believe in our mission and wants to acquire us, then that’s something we would have to think about. But we couldn’t ever compromise on our core principles—and for now, we’re just taking customers from them. Sooner or later, they’re either going to have to do everything that we do or let us show them the way.
Q: When will you be supporting Cardano (ADA) or Polkadot (DOT)?
Alex: DOT is a week or two away to being added to the wallet, but Cardano is a little more complicated, because our custodians have to support the assets that we offer. Adding ERC20 tokens is easy, but adding a completely new blockchain is a lot of work and requires a lot of testing. If you’re a big holder of one of these assets and want to take a loan against it, send us an email and we can usually accommodate these situations. But to enable it for everyone in the wallet to earn interest, we need our custodians to support it and need to run a node on the blockchain itself.
Q: Could we get the final details on the Spark airdrop for XRP holders?
Alex: All you need to do is hold XRP in your Celsius wallet and you will get Spark. There’s nothing special you need to do.
Q: Why are the interest rates on MATIC and SNX so high?
Alex: It’s because these tokens have such high native staking yields. We are able to earn high yield with them, and so that’s why we pay it out.
Q: How does volatility affect Celsius’ business model?
Alex: Volatility is a great thing for Celsius, as long as we practice proper risk management. This means that as soon as there’s volatility, all of our institutions start reaching out to us. And when we have high demand, we’re able to extract more out of the institutions so we can pay more to our depositors. We’re always looking to manage our risk, and make sure that we’re not over-extending ourselves during times of volatility as well.
Q: Why doesn’t Celsius just pay CEL interest from the Treasury?
Alex: Basically, it boils down to the fact that we think CEL token is worth more than the price that it’s currently selling at. Eventually, we will need to sell some of our Treasury for cash, or use some of our Treasury to fill orders, but we don’t need to do it now.
Q: What kind of numbers are you seeing from the LINE partnership?
Alex: We cannot reveal numbers for our partnerships—as a part of our agreement, our partners have to disclose these numbers themselves. As I mentioned before, LINE has twice as many users worldwide as PayPal. We’re building new services with them to expand the partnership—the future is very bright.
Q: I’d love to have a Celsius debit card—is there any plan for this?
Alex: We didn’t say that we were never going to create a debit card, we said that we wouldn’t do it until we could create one that was acting in your best interest. I’ve had credit card debt before—just because I’m rich now, doesn’t mean that I haven’t been poor in the past. I know the pain—I’m doing this because I know that pain. We’re trying to help people navigate through their situation of financial uncertainty, and help them come out more financially secure.
Q: Could you please share with us some knowledge from your previous companies that applies to Celsius today?
Alex: First of all, my startups were all venture-capital backed—and I lost control of all of those companies eventually. So I learned from that, and I wanted to only open ownership in this company up to the community—both in terms of CEL token and our equity. Most entrepreneurs end up owning such a small portion of their company, and so we’re trying to prove that acting in your customer’s best interest can be in the best interest of both founders and of the company.
Q: With Tether investing in Celsius and Celsius providing services on Bitfinex, will CEL token be listed on Bitfinex?
Alex: We love Bitfinex and their sister company, Tether. We’re waiting for them to list us—but we’re not going to pay any fees, and we’re not going to make any special accomodations. For Celsius, we think Uniswap is an amazing market for CEL token—we’re actually a big liquidity provider for CEL token on Uniswap. This means that while a listing on Bitfinex would be nice for the community, for Celsius, providing liquidity on Uniswap is the best deal for us.
Want to unbank yourself with Celsius (and get a free $20)?
- Install the Celsius wallet (https://celsius.network/get-the-app/)
- Use a referral code during registration (137247d31d)
- Deposit $200 of crypto or stablecoins
You will earn $20 in BTC once you hold your deposit for 30 days
