Did Celsius Just Repay $120M to Maker?

Mike Dalton

Jul. 4, 2022

The crypto lending firm may have made several DAI repayments on Sunday and Monday, though neither party has confirmed it was in fact Celsius that made the payment.

Shutterstock photo by mundissima

Key Takeaways

Celsius seems to have repaid $120 million to multi-collateral Dai vault #25977 in a series of three transactions.
The crypto lending firm suspended withdrawals last month; these repayments could help it regain solvency.
Celsius has not confirmed that it owns vault #25977, but it is widely believed that this is the case.

Celsius appears to have repaid $120 million of its debt to Maker, the DeFi protocol behind the Dai stablecoin, although Celsius is not entirely confirmed to be the payor.

Maker Vault Sees Debt Repayments

Celsius may have made good on part of its outstanding debts this weekend.

Celsius first shut down withdrawals, transactions, and swaps on June 13. Now, the firm seems to be repaying its debt in an attempt to regain liquidity.

Data suggests that multi-collateral Dai vault #25977 saw three significant repayments between Jul. 3 and Jul. 4, 2022.

Those transactions involved 64 million DAI, 50 million DAI, and 6.2 million DAI. As DAI is pegged to the value of the dollar, those transactions are worth roughly $120 million in total.

The vault also saw $22.6 million repaid on Jul. 1, as well as $53.7 million repaid between Jun. 14 and Jun. 16.

Can Celsius Regain Solvency?

Large debt repayments such as these could help Celsius regain solvency and put it in a position to re-enable withdrawals.

These Maker debts likely make up just one part of Celsius’ obligations, as the company invests in various crypto and DeFi contracts to generate revenue for its users.

Still, these repayments have lowered vault #25977’s liquidation price and reduced the likelihood of forcible liquidation.

Vault #25977 uses Wrapped Bitcoin (WBTC) as collateral, and as such, it will be liquidated if BTC falls to a certain price. On June 13, the vault’s liquidation price was $16,852—dangerously close to Bitcoin’s typical June price of $20,000.

Now, after the past month’s payments, the vault’s liquidation price is $4,966, leaving much more room for prices to vary.

Does Celsius Own Vault #25977?

Celsius itself has not confirmed that it owns the vault in question, nor has it confirmed that it has repaid these debts.

However, MCD vault #25977 is believed to belong to Celsius as it is owned by the Ethereum address beginning with 0x87a6. That address is one of many Ethereum addresses that Larry Cermak of The Block identified as belonging to Celsius in June.

An update from Celsius published on Friday says little about the firm’s DeFi investments. Instead, it suggests that the firm is exploring strategic transactions and liability restructuring in order to regain solvency and reopen withdrawals.

Other reports from Sunday suggest that the firm has laid off a quarter of its employees in the wake of its liquidity crisis.

Disclosure: At the time of writing, the author of this piece owned BTC, ETH, and other cryptocurrencies.

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