Glossary
Celsius Collapse
The June 2022 freeze and July 2022 bankruptcy of Celsius Network — a CeFi yield platform with ~$12B in customer deposits that ran out of liquidity after the Terra crash.
Celsius offered customers high yields (up to ~17% APY) on crypto deposits, ostensibly generated through DeFi yield farming and institutional lending. The model worked while crypto markets rose and required positive net inflows.
After the Terra collapse drained liquidity from related DeFi positions (notably stETH), Celsius froze withdrawals on June 12, 2022, citing "extreme market conditions". It filed for Chapter 11 on July 13. Founder Alex Mashinsky was later charged with fraud. Customer recoveries through the bankruptcy process have been partial.