FinTech has experienced tremendous growth in recent times, posing a challenge to traditional banking systems. In line with this trend, the Celsius wallet has been developed to facilitate crypto lending, offering users the ability to engage in conventional cash equivalent transactions. All of these services are made possible through blockchain technology, which serves as the backbone of the Celsius network. At the core of the system is the CEL token, an ERC-20 token that is used within the platform for various purposes such as generating interest, taking out loans, making peer-to-peer payments, and earning bonus rewards, among other functionalities. The value of CEL tokens has skyrocketed by almost 500% in just two months, resulting in significant profits for early adopters. So, what sets the Celsius wallet apart from others, and how does it work?
Overview of the Celsius Wallet
The Celsius Network is a blockchain-based lending platform that enables users to borrow digital assets and earn a passive income by keeping their holdings in a savings account. The interest earned is paid out as a weekly reward every Monday. To maximize their lending and interest rates, users are encouraged to hold and stake CEL tokens for as long as possible. In late June 2021, MVP Workshop’s team of engineers and designers joined Celsius to establish a product development center in Belgrade, adding to the existing research and development team in Tel Aviv. This move demonstrates Celsius’ commitment to investing in and expanding its technical capabilities, further reinforcing the trust placed in Celsius and its mission by the MVP Workshop team.
How Does the Celsius Network Generate Interest?
As of 2020, the Celsius network had over 106,000 members holding crypto on its platform, and the number of registered users on its lending platforms has exceeded 500,000 in 2021. Celsius has access to the native tokens held within its network and can lend them to institutional investors from its pool of crypto portfolios. There are over 200 institutional investors available on the Celsius network. According to Smartcredit, Celsius earns 6%-15% interest (APR) from institutional investors and passes on 80% of that interest to its users. The remaining 20% is retained by Celsius as a service fee. This translates to a service fee of 1.2% – 3% on borrowed funds, which is slightly higher than other crypto lending platforms. However, it is important to note that lenders only receive interest payments when their funds are actually lent out. As long as there are lenders on the platform, the interest generation model continues to work for everyone.
A Brief Background on the Celsius Founder
Alex Mashinsky, the founder of Celsius Network, is no stranger to entrepreneurship, as he is currently on his eighth startup venture. Celsius Network raised $50 million through an Initial Coin Offering (ICO). Mashinsky has also made approximately 120 VC investments, holds 34 patents, raised over a billion dollars for his companies, and has achieved exits totaling at least $3 billion. Mashinsky’s immigrant-to-riches story is inspiring, and his previous victories against phone companies with VOIP and the Subway franchise are just a glimpse of what he plans to accomplish with Celsius Network. His ambitious goal is to replace traditional banks and their profit-driven models with an automated, decentralized, and distributed platform that prioritizes the best interests of depositors and allows hard-working individuals to retain 80% of the profits generated by banks.
Accessing Crypto Assets and the Celsius Credit Card
The Celsius app provides users with access to their crypto assets and allows them to earn interest through a Celsius savings account. Existing members can easily access their crypto assets by logging into the Celsius mobile app, where they can view their wallet balances, approve loans, and perform other transactions. New members need to complete the registration process, which grants them access to various features such as cryptocurrency exchanges, coin purchases, minimum balance checks, cash borrowing, interest earning, and participation in cryptocurrency lending activities.
Charges Associated with Celsius App Usage
The Celsius network does not charge any fees for investors who wish to earn interest at the best rates. Users can earn top rates on any amount of crypto and receive payments every Monday for simply holding their assets. Additionally, users can earn up to 25% more rewards by choosing to earn in CEL tokens. Celsius network charges are covered by the interest rates it charges institutional lenders. Of the interest rates paid to Celsius, 80% goes to the members on the Celsius network website, while the remaining 20% covers additional necessary fees.
Stages on the Celsius Network
The Celsius token network consists of four tiers: bronze, silver, gold, and platinum. Users are categorized based on the number of CEL tokens they hold in their crypto portfolios. The Celsius network offers interest rates that are equivalent to the value of the deposited cryptocurrency. Owning a Celsius wallet guarantees users interest payments for holding coins on the Celsius network. This loyalty system is designed to incentivize users to hold more CEL tokens and increase their cryptocurrency lending ability. As crypto lending continues to gain popularity, more funds are required to meet future commitments.
Requirements for a Loan on Celsius Network
To borrow cash on the Celsius Network, individuals can use their collateral to borrow as little as $1,000. The loan process is quick and paperless, with approvals granted in just a few minutes. There are no credit checks or origination fees involved, and the entire process is automated. Users can specify the loan amount they require through the system, and the correlated interest rate will be calculated accordingly. Transactions can be made in cash or cryptocurrencies.
Is Celsius Network Safe?
Despite offering zero-fee remittance services, Celsius Network is far from being a scam. The network has been operational since 2017 and has experienced significant growth, with the number of users increasing from around 106,000 last year to over 500,000. This growth is a testament to the trust and legitimacy of the Celsius network. Reputable sources such as Coinbureau and Market Good vouch for the safety and reliability of Celsius. The network boasts a team of experienced individuals with diverse backgrounds and expertise, ensuring the security and privacy of users’ funds. While users have control over the private keys to their portfolios, Celsius maintains the public key to ensure overall security.
Withdrawing Funds from Celsius Network
Withdrawing funds from the Celsius network is a straightforward process. The network does not charge any transaction or withdrawal fees, making it convenient for users to access their funds. The withdrawal limit is determined by security measures, with recent developments imposing restrictions on withdrawals of $50,000 and above. Users can make such transactions once every 24 hours, and the delivery time for larger amounts may take between 24-48 hours.
Conclusion
Celsius is an ecosystem with over 1 million users who can earn up to 17% yield on their crypto assets. The platform offers a wide range of benefits, including weekly payments in new coins, low-interest cash borrowing, fee-free transactions, and mobile app accessibility. While there are always risks involved in holding cryptocurrencies, Celsius strives to prioritize security and has measures in place to protect users’ funds. With its large user base, strong leadership, and positive reviews, Celsius has established itself as a reputable and reliable crypto lending platform.
