While the large liquidations continue on the Celsius network platform, it is clear that the cryptocurrency lender is in a dire phase. Multiple sources claim that investment banking giant Goldman Sachs has begun planning to purchase Celsius' assets.
Goldman Sachs leads the group of investors in buying Celsius' assets
According to sources, Goldman Sachs plans to ask investors for a $ 2 billion commitment of funds. The sources added that the major investment bank is looking to take advantage of Celsius' situation and buy its assets at heavily discounted prices.
About two weeks ago, Celsius networks released an official statement stating that withdrawals were no longer available on the platform. The cryptocurrency lender blamed the current market conditions.
A company report last month claimed that Celsius had made over $ 8 billion in loans to multiple customers. Additionally, the company manages nearly $ 12 billion in assets. But the cryptocurrency lender struggled with liquidity problems following the downturn in the cryptocurrency market.
However, according to a Coindesk report, Goldman Sachs is considering pledging funds from web3 crypto funds. The report also says the bank is in talks with funds that specialize in distressed asset operations. While most of Celsius' assets are cryptocurrencies, buyers would buy them at below-market prices.
There is a catch in this business - Arthur Hayes
Speaking of the Celsius asset purchase rumors, 100x co-founder Arthur Hayes takes a counter view of the purchase by Goldman Sachs. Hayes says rumors shouldn't be believed until Goldman Sachs releases an official confirmation statement.
The derivatives co-founder explained that the investment bank is unlikely to commit its funds to the purchase. He added that Goldman Sachs is likely to bring interested investors together and help them with the structure of the deal.
Thereafter, the group of investors would own the purchased assets. However, Goldman Sachs will only receive a commission for its services. Hayes also said that the industry should only express its joy when it can again make withdrawals from the Celsius platform.
He then added that the success of this deal will benefit the next cryptocurrency bull run. Hayes warned that cryptocurrency industry participants shouldn't cheer up any bailouts, as they could be public relations stunts. Instead, they should only cheer when these rescue attempts are successful.
According to him, a partial or full withdrawal of funds from these insolvent cryptocurrency lenders would mean the bailouts were not a public relations gimmick. Following Celsius' liquidity problems, the company enlisted the help of restructuring attorneys from the Akin Grump Strauss Hauer law firm and Citigroup investment bank. Insider sources say both professionals have advised that the best solution for Celsius is to file for bankruptcy.