CEL, the native witness of crypto lender Celsius Finance, has risen 50% a day as members of the project community tried to orchestrate a little pressure.
A short close occurs when traders bet that the price of an asset will go down, but the price goes up, forcing them to close their positions.
Gathering around the hashtag #CELShortSqueeze on Twitter, Celsius headlines planned to force short pressure by buying CEL on the FTX cryptocurrency exchange, moving it to decentralized exchanges (DEX) and setting limit sales orders (only a sales limit order can be executed). at the limit price or higher).
The strategy is similar to that used by daily traders during the brief pressure of GameStop in January 2021, causing the price of GameStop (GME) shares to rise by more than 1,000% in two weeks.
On that occasion, hedge funds with short positions in GME suffered heavy losses, asset trading stalled on the New York Stock Exchange and the Robinhood trading app blocked users from buying GME (causing a demand from dissatisfied customers).
So far, it seems that the Celsius shortening is pushing the price of CEL up; it currently trades at $ 1.39, about 50% a day and 320% a week, for CoinMarketCap, although it has withdrawn from its 24-hour high of $ 1.56. However, it is still well below the record high of more than $ 8 for the witness, recorded in June 2021.
However, GameStop’s short press has a healthy lesson for marketers; by the end of January 2021, GME had fallen from more than $ 300 to $ 100. It is now trading at $ 135, which is, to be fair, well above its price before the short narrow, about $ 20.
Celsius will “take time” to stabilize liquidity
Celsius sent shockwaves through the crypto industry when it froze withdrawals, exchanges and transfers between accounts earlier this month, citing “extreme market conditions.”
Yesterday, the crypto lender issued a statement saying that its “goal remains to stabilize our liquidity and operations,” admitting that “this process will take time.”
The company said it is maintaining an “open dialogue with regulators and officials” and is looking to “find a solution”.
Celsius ’main investor, BnkToTheFuture, has volunteered to help deploy“ financial innovation ”to help the company as part of a recovery plan. BnkToTheFuture co-founder Simon Dixon argued that “traditional finance will not have a timely Celsius solution”, but declined to share details of the recovery plan proposed by the company “before”. [CEO] Alex [Mashinsky] and the Celsius board is ready “.
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The opinions and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.
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