Cryptocurrency lending platform Celsius Network has raised $400 million in a new funding round led by WestCap.
Celsius hopes it gets more credibility
Alex Mashinsky, CEO of Celsius, said he hoped the fundraising would reassure regulators about the stability of its crypto lending business and help open doors in major financial markets. “This is not $400 million. This is the credibility of the people who issued these checks,” he said. The latest round of funding values the company at more than $3 billion, a significant increase from a slight capital raise last year led by Tether, the company behind USDT, which valued Celsius at $120 million at the time.
The company has seen significant growth over the past year as crypto loans, and performance strategies have increased. Celsius said total assets on its platform reached $25 billion this month, up from $10 billion in March, with more than 1 million registered users.
Regulatory pressure affected the company
But the company has also seen some roadblocks along the way. In September, the New Jersey attorney general’s office asked the company to stop issuing interest-bearing cryptocurrency products. Texas state regulators requested a hearing in February to assess whether similar action should be taken.
In addition to reviewing securities compliance, regulators have also questioned the transparency of how crypto platforms process investors’ deposits to generate the returns they pay. Officials in Texas and New Jersey claimed that Celsius was “proprietary trading,” while the company insisted that its deposits were only used for loans and mining cryptocurrencies.