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Users can earn interest on their cryptocurrency holdings or borrow cryptocurrencies in exchange for their digital assets via the Celsius Network, a platform for lending and borrowing cryptocurrencies. Alex Mashinsky, a well-known businessman and inventor in the telecoms sector, established the platform in 2017.
Bitcoin, Ethereum, Litecoin, and many other cryptocurrencies are available at attractive interest rates through Celsius Network. Users can receive interest on their assets either weekly or monthly, and Celsius’ interest rates are often greater than those of conventional banks or other cryptocurrency exchanges.
Users of the Celsius Network can borrow cryptocurrencies at low interest rates in addition to earning interest on their existing cryptocurrency holdings by pledging their existing cryptocurrency holdings as security. The website provides quick and simple loans in a variety of cryptocurrencies and fiat currencies.
Due to its high interest rates and user-friendly interface, Celsius Network has grown in popularity among cryptocurrency investors and traders. The business is renowned for its dedication to security and transparency, with all user assets being kept in cold storage and insured against loss or theft.
The history of Celsius Network
Celsius Network was founded in 2017 by Alex Mashinsky, a serial entrepreneur and inventor in the telecommunications industry. Mashinsky has over 30 years of experience in the tech industry, and he is the inventor of several patented technologies, including Voice over IP (VoIP).
The idea for Celsius Network came about as a result of Mashinsky’s frustration with the traditional banking system and its low interest rates. He believed that there was a better way for people to earn a return on their money, and he saw an opportunity to disrupt the banking industry using blockchain technology.
In June 2018, Celsius Network launched its mobile app, which allows users to earn interest on their cryptocurrency holdings and borrow cryptocurrencies against their crypto assets. The platform initially offered interest rates of up to 5%, which was significantly higher than the rates offered by traditional banks.
Since then, Celsius Network has grown rapidly, and as of 2021, it has over 1 million users and manages over $20 billion in assets. The platform has continued to expand its offerings, adding new cryptocurrencies and fiat currencies, as well as new features such as crypto-backed loans.
Celsius Network has also received several rounds of funding, including a $50 million Series C funding round in April 2021, which brought the company’s valuation to over $3 billion. The company has been recognized for its innovative approach to finance, and it has won several awards, including the 2020 Blockchain Innovation Award from the Blockchain Association of Africa.
How Celsius Network works
Users can earn interest on their cryptocurrency holdings or borrow cryptocurrencies in exchange for their digital assets via the Celsius Network, a platform for lending and borrowing cryptocurrencies. This is how it goes:
Interest accrual
- The Celsius Network app accepts cryptocurrency deposits from users.
- These cryptocurrency are lent by Celsius Network to institutional borrowers like hedge funds or exchanges at a higher interest rate.
- The users that have deposited their cryptocurrencies are given a portion of the interest collected by Celsius Network. The cryptocurrency and the deposit term affect how much interest is paid.
Cryptocurrency borrowing: Users can borrow other cryptocurrencies or fiat money through Celsius Network by pledging their existing cryptocurrencies as security.
- Loan amounts are determined by loan-to-value (LTV) ratios specified by Celsius Network and the value of the collateral.
- The type of cryptocurrency and the loan’s duration affect the interest rate.
Other features offered by Celsius Network include:
- Celsius Pay is a peer-to-peer payment platform that enables free cryptocurrency and fiat currency sending and receiving.
- A non-custodial wallet that enables users to safely store their cryptocurrency is called Celsius Wallet.
- Celsius Loyalty Program: A rewards scheme that rewards holders of the native cryptocurrency of Celsius Network, the CEL token, with better interest rates and other advantages.
Celsius Network aims to provide users with a simple and transparent way to earn interest on their cryptocurrencies and access loans using their existing crypto holdings as collateral. The platform’s user-friendly app and competitive interest rates have made it popular among cryptocurrency investors and traders.
Does Celsius Network charge a fee for its services
Yes, Celsius Network charges fees for its services. Here are some of the fees charged by the platform:
- Deposit fees: For some cryptocurrencies, Celsius Network levies a deposit fee of up to 0.1%.
- Fees for withdrawals: Depending on the cryptocurrency, Celsius Network may charge a withdrawal fee for specific cryptocurrencies.
- Loan origination fees: For some loans, Celsius Network levies a 3% loan origination fee.
- Early termination fees: Celsius Network reserves the right to impose a fee if a user decides to discontinue their loan early.
- Network fees: For some transactions, such taking cryptocurrency out of the platform, Celsius Network may levy network fees.
It’s worth noting that Celsius Network’s interest rates are typically higher than those offered by traditional banks, and the platform offers many features and benefits that are not available from traditional financial institutions. Additionally, the platform is transparent about its fees, and users can view all fees in the Celsius Network app.
