Crypto Savings and borrowing companies like BlockFi and Celsius Network are coming under increased regulatory scrutiny. Covered: Celsius Announces Important Update What Exactly Does Accredited Investor Mean To Celsius? Current State And Future Of CeFi Celsius Announces Important Update Important Celsius Update for our Users in the United Stateshttps://t.co/pzU9MERJEZ — Celsius (@CelsiusNetwork) April 12, 2022 Celsius […] The post Breaking: Celsius Announces Important Update appeared first on CryptosRus.

Breaking: Celsius Announces Important Update

Crypto Savings and borrowing companies like BlockFi and Celsius Network are coming under increased regulatory scrutiny.

Covered:

  • Celsius Announces Important Update
  • What Exactly Does Accredited Investor Mean To Celsius?
  • Current State And Future Of CeFi

Celsius Announces Important Update

Celsius Network announced today that it is updating its services for American-based users. Spoiler alert: the little guy takes an L.

Celsius CEO Alex Mashinsky said “Our industry is going through a paradigm shift – as previously acknowledged, we have been working with regulators around the world. In line with recent regulatory guidance, there will be changes to the way our Earn product will work for users based in the United States.”

Mashinsky also specified that Non-American users are not affected.

Similar to BlockFi’s recent agreement with the SEC, current users will continue earning interest on whatever holdings they currently have in their Celsius accounts. Not to mention, users may add crypto that earns interest up to April 15th. However, after April 15th most users will be unable to earn interest on any additional crypto they’ve added.

After April 15th, only verified accredited investors will be able to add new crypto to their accounts. It’s unclear from the announcement exactly what the requirements are for accreditation — or if they are using the SEC guidelines. Though, Mashinsky did urge users to call Celsius to confirm your status. 

For more on the updates, check out Celsius Network’s Medium post. 

Recommended: Celsius Network Just Got A Lot Of Money From Some Very Credible People

Current State And Future Of CeFi

The announcement puts CeFi in a tough spot. In particular, Celsius adding the requirement that investors be accredited potentially runs counter with the raison d’être of CeFi, which is to unbank folks.

Banks, as some of you may know, aren’t particularly generous. All you have to do is compare the rates that Celsius gives on stablecoins to what a savings account offers you. But if only people who have a lot of money already can use this service, what’s the point?

The current thresholds for what the SEC believes makes an accredited investor are a bit all over the place. You can be eligible if you have 1 million in net worth (minus your residence), but you can also be eligible if you’ve earned 200k in the last two years, or 300k combined with a spouse.

Still, those numbers shouldn’t matter. If you only have a thousand to spare you shouldn’t be denied the ability. Certainly, there are risks in investing money with the likes of BlockFi and Celsius, but the answer shouldn’t be taking away a service that undercuts the vultures of human misery that is TradFi.

Recommended: Rumors That Celsius Network Received A Billion Dollars Worth Of Emergency Tether Are False

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