Celsius Collapsing: Causes, Concern, and Catastrophe (Feat. Dirty Bubble Media) - Episode 79

In this episode Bennett Tomlin and Cas Piancey are joined by Dirty Bubble Media to discuss Celsius Networks, it's involvement in DeFi, Alex Mashinsky's troubled past, and more.
Read more: cryptocriticscorner.com/2022/...
Other episodes mentioned in this episode:
Episode 26 - Cryptocurrency Lending is Too Good to Believe • Cryptocurrency Lending...
Episode 71 - Terra, Luna, and Algorithmic Stablecoins • Terra, Luna, and Algor...
Episode 72 - We Never Want to Discuss Terra and Luna Again…and yet • Luna and Terra are Cra...
Find Dirty Bubble Media:
Twitter - / mikeburgersburg
Substack - dirtybubblemedia.substack.com/
Other places to find Crypto Critics' Corner
Website: cryptocriticscorner.com/
Twitter: / cryptocriticpod
Instagram: / cryptocriticpod
TikTok: vm.tiktok.com/TTPdPN2hK9/
Discord: / discord
Bennett's Twitter: / bennetttomlin
Cas' Twitter: / caspiancey
Bennett's Newsletter: TheFUDLetter.com/
Cas' Blog: / thecaspiancey
Bennett's Blog: bennettftomlin.com/
Asher's Twitter: / ashtag23
Timestamps:
00:00 Welcome Dirty Bubble Media
0:56 What is Celsius Network?
2:19 The CEL Token
4:50 How does Celsius make their yield?
15:35 The history of Alex Mashinsky
18:53 Moshe Hogeg and Celsius
24:55 Fears of Problems at Celsius
37:50 CEL Token as a Security
40:32 Celsius and Gemini
This video was produced and edited by Asher Hirsch.
#cryptocurrency #crypto #podcasts #listenable #bitcoin #lending #celsius #celsiusnetwork

[@shaanthacikyan3958]

Best media discovery of the last year. Happening upon you two last summer/fall has enhanced my life. As I’ve commented in the past, you provide clarity in a complex new world that too few are willing to focus. Thank you, thank you!

[@CryptoCriticPod]

Thank you for your kind words!

[@Jmattel19]

Crypto Critics' Corner is necessary viewing for every major crypto calamity. I wouldn't understand half of what was going on if not for you guys and your guests. Thank you!

[@CryptoCriticPod]

Thank you!

[@zakmendoza8817]

Non-crypto norman here, your guy’s vids are easy to understand and I appreciate the candor of the DD you’ve put together.

[@CryptoCriticPod]

Thank you!

[@billf8217]

Brilliant, prescient and devastating. I wish I had discovered Dirty Bubble Media a month ago.

[@CryptoCriticPod]

Thank you!

[@valmik9567]

Bennett's face when Cas said "I don't like to make any of these podcasts personal" 😂

[@CryptoCriticPod]

I had some questions related to past episodes if he believed that to be true

[@valmik9567]

@@CryptoCriticPod I have been listening since episode 1 but watching the videos has been so great. You trying hard not to laugh is too funny, Bennett. I hope you don't play poker too much.

[@CryptoCriticPod]

Not too often, it doesn’t alway go my way

[@ratcitywoodwork]

I used to listen on Spotify, but it’s moments like that that make watching on youtube so much better😂

[@LiamPorterFilms]

Whenever I check KZbin for news on crypto collapses, I get a tonne of weird channels that try to decry the individual crypto bad actors, while glorifying the overall crypto project. Podcasts like yours are a breath of fresh air. Keep documenting the decline!

[@CryptoCriticPod]

Thank you!

[@rileybow8030]

yea it's funny to be hearing about SBF trial then a crypto sponsor break lol

[@VIVIan-us9zk]

This podcast has quickly become a must-listen. Recommending this podcast to people in my life already invested in crypto has been interesting to watch. The sudden unconscious mental gymnastics and maneuvering makes me feel like I understand the (lack of) response climate change, given that most powerful people are invested in burning more fossil fuels in one way or another.

[@ashforghani5109]

My favorite podcast on the internet in 2022.

[@CryptoCriticPod]

Thank you!

[@ashforghani5109]

@@CryptoCriticPod No problem. You guys are a needle in a haystack, but when the crypto winter starts, hindsight will be 20/20 lol.

[@geocreative]

I’ve been waiting all day to hear your takes

[@HongPong]

after all these years it is so demented to see the pileup of ponzi like and unregulated, opaque derivatives all over the cryptocurrency world. just so different than even a few years ago. great explanations cheers

[@CryptoCriticPod]

Thank you!

[@davidchess1985]

Isn't the answer to "where are they getting their returns?" pretty much always "fraud"?

[@CryptoCriticPod]

Often

[@piprod01]

It's ongoing so we have to pretend like there is a chance it's legitimate. for now.

[@asswhole4195]

This is one of my favorite episodes, this guy is great!

[@CryptoCriticPod]

Thank you and yes he is!

[@pomeloog]

Thank you for making us remember to always be skeptic, I didn't know it went that deep, I saw some AMA's and said: "Meh I guess it's true, if you say so". Man, was I wrong! Didn't invest because I never give my keys, but even talked about them as something that seemed safe.

[@0xBADB00B5]

Mark Burgersburg is awesome, thank you

[@jaygreenakajackstax9345]

I totally agree, for me one of the best you tube discoveries this year. Thanks guys. Keep up the good work. I love the vids, like this one, where you connect the dots between different people and protocols. You're like two detectives and i love it. It's educational and exiting at the same time 🙌

[@phillipgeorge8147]

So glad to see your channel grow! I’ve been listening since last year and the work you guys are doing is amazing!

[@CryptoCriticPod]

Thank you!

[@ryanbergan773]

you guys saved me 300-500bucks before i invested in march

[@ecripto6523]

You guys are awesome! Thanks for sharing your research. Many other protocols to follow.

[@CryptoCriticPod]

Thank you!

[@gmalcolms]

Celsius is not necessarily a ponzi scheme, but rather, it appears to be just a poorly managed bank. They have invested 70% of their deposits into effectively somewhat illiquid zero-coupon bonds that have an extension risk. The other 30% is invested in high-yielding DeFi protocols, but they can't earn enough yield on them to pay their own high interest on 100% of their deposits. So in order to pay interest to their clients they need to take the money from other depositors, or else sell some of the stETH, which could depress the price. This would work unless the switch to Ethereum 2 is delayed too long, the interest they promise to pay out is too high, they lose money on the investments in the DeFi protocols, or there are too many withdrawals by their depositors, i.e., a bank run.

[@yellow6100]

since they are not a bank and want you to unbank they cant be a poorly managed bank nor can they have a bank run. Boom !

[@user-ww8nz5oo2l]

exactly not a bug, more of a feature :)

[@CryptoCriticPod]

The qualifications for a Ponzi scheme are two-fold: 1. Earlier investors are paid by layer investor deposits ✅ 2. They attracted investment by lying about features of the scheme ✅ I understand the distinction you’re trying to make, but it meets all the requirements to be described as a Ponzi scheme

[@mrckb]

Love your work. Please keep doing what you're doing. Always hyped to see a new ep in my feed.

[@CryptoCriticPod]

Thank you!

[@JohnSmith-pn1vv]

Great vid as always. Crypto scams crashing so quick it's important to get these vids out asap for the 'I told you so' effect. Get a lido vid out before they blow up!

[@ukxgerard]

Thanks great information

[@CryptoCriticPod]

Thank you!

[@stephen1193]

This channel is amazing. Idk how I found it but I'm glad I did. Highly enlightening.

[@CryptoCriticPod]

Thank you!

[@OrlaHoulihan]

IDK how anyone can claim y'all are gleeful about any of this if they can see how much the dishonesty, the audacious scammery of it all frustrates you. Poor Bennett looked to be in physical pain at one point.

[@asswhole4195]

When are you guys releasing books? Are you waiting for Tether to reach its conclusion first? I can't wait to read it!

[@CryptoCriticPod]

We are waiting for exactly that!

[@igrowfaster]

Reminds me of Stanford Bank from 15 years ago, shortly after Madoff. You can look up Stanford Bank and their CDs that offered high yields. They were based in the Bahamas but marketed to Americans. I even saw some of their ads airing on CNBC.

[@CryptoCriticPod]

Sounds like the Prime Bank Fraud we discussed in our episode with John Reed Stark!

[@vikz569]

Great respect to you guys!

[@Mellowbaton]

Can you spell systemic risk? Crazy how these stupid lending platforms have dozens of projects built on top of them

[@korvocorsair2427]

Fantastic research thankyou, this was very informative

[@CryptoCriticPod]

Thank you!

[@JohnSmith-ox3gy]

Wasn't aware of the Tether exposure to Celsius.

[@lukeadams8518]

don't have time to watch but playing thru silently bc I love u guys n wants u to have views

[@xSilverFernx]

Thank you for the exquisitely researched and comprehensive episode!

[@CryptoCriticPod]

Glad you enjoyed it!

[@CraigFisher1]

Thanks!

[@alexamadams]

You guys are the best! Very timely episode.

[@CryptoCriticPod]

Thank you! And we actually recorded this over a week ago!

[@Bananamaltastic]

Just backed the truck up on KZbin likes w/ Crypto Critics Finance. Lambos any day now. Literally can't go tits up. Have fun staying poor.

[@fallous]

HODL TO THE LIKES MOON!

[@jmitterii2]

@@fallous Conditioned. Sorry. Not fun being a bag holder, I sold for profits at the top and now just waiting for the entire cluster mug of scams that Pyramid and Ponzi schemed this entire tulip fake money market to the moon... but we got a run on the junk and it's over. Con has ran it's course. Let tether and circle and all those stable coin and chicanery other crazies go bust... and maybe we can consider buying some lottery tickets on tenth of a penny to the dollar... or just mine the shit for next to nothing on the next bozo the clown block chain, spending no money at all, and if it gets scammers pumping it again... then can sell again. But don't be the victim to this giant scam sandwich. Private money isn't new, it's as old as recorded history of mankind, and it always goes bust fairly quickly... usually a decade or less.

[@fallous]

@@jmitterii2 Not sure why you're replying to me unless you misunderstood the OP's comment to which I responded. I never bothered with cryptocurrencies given that when I first looked at the bitcoin model in 2010 it failed basic economic sniff tests for me. A currency that claims to be asset-backed but the only "asset" is energy expended is like claiming you're on a gold standard when you evaporate gold reserves in order to run a printing press. If you can't exchange the currency for the backing asset, you kinda fail the whole "asset-backed currency" thing.

[@Bananamaltastic]

@@fallous DIAMOND HANDS 💎✊💎✊💎🚀🚀🚀

[@KK-pm7ud]

Someone just tried to post your video to r/crytpocurrency. The mods deleted it. Just so sad that mods have so much power to keep truth off of their subreddit when it is supposed to be about a specific subject.

[@dakuru]

love you guys

[@CryptoCriticPod]

Thank you!

[@colbyapple]

Excellent Info

[@CryptoCriticPod]

Thank you!

[@giftoffire4868]

4-5 likes and subscribes in return!!! I laughed so hard. Great work guys.

[@xavdeman]

Jun 14 2022, this podcast. July 2022, Celsius filed for Chapter 11 bankruptcy in, after pausing all withdrawals. July 13, 2023, former CEO, Alex Mashinsky, arrested under criminal and civil charges of fraud and intention to manipulate the market, as well as suits brought by the SEC and FTC.

[@securedcertification477]

Celsius... the perfect lending platform... we borrow from you and give to him ... we call it a Madoff scheme... so its definitely NOT a Ponzi....duh!

[@eKoush]

All I wanted was a simple lending platform. I am quite certain that it would work quite well if it is kept simple. Borrow and Lend out, especially if you have all the connections to wall street and the liquidity needed and the backing to pay for all the expenses and licensing. I wouldn't mind lower interest rates at all. I just want the crypto not sitting in my wallet idle. I don't know why something like Celsius getting so much support and trust over the years would go and gamble so hard with people's funds.

[@xavdeman]

What if the person borrowing the coins from you doesn't pay them back? They're anon so how are you going to prevent such risks?

[@jmitterii2]

Ponzi and pyramid that is the tulip market comes undone. :( Was fun to trade it for a while... but I think lots of others really got screwed drinking the kool-aid and the conditioning... that even Coin Base taught... HODL I learned from them. That's irresponsible. Make it cute to train and condition people to become bag holders.

[@wirelessgrapes2242]

Lmao Monday June 6th, great timing

[@slomnim]

oh man, great talk. kinda sad y'all waited on releasing it for a few weeks!

[@CryptoCriticPod]

Just a week in this case!

[@lug.5329]

Cas said he doesn't want to get personal. I think everything is personal (like what Puzzo said in The Godfather) because there is no such thing as an impersonal job or even a hobby. Money is also very personal.

[@frvo]

I am Caspian Sea... Caspian Sea Monster!

[@GaaikeEuwema]

A noob question i was left with: can you guys explain how lido is turning locked staked assets into liquidity? That seems weird.

[@CryptoCriticPod]

They create a tokenized representation of the coins you have staked

[@GaaikeEuwema]

@@CryptoCriticPod that still seems strange to me.. why would that token have value.. but i guess that's often the question 😝

[@CryptoCriticPod]

Because it gives you a claim on the future ether

[@nucemgd]

Edit: I didn't watch the entire podcast before posting TL/DR: Full disclosure I'm a Celsius customer. I began moving funds off the platform after the announcement on 04/13/22 that any new crypto deposited after 04/15/22 would not earn yield unless you have filed paperwork to prove you're an accredited investor. Apparently that was a wise decision given what has happened this week. I moved 6 figures off but still have a small amt. - getting smaller daily - on the platform. None of my comments should be taken to imply that Celsius isn't a scam but if they are then they are the best or worst - depending on how you see it - scammers in existence. I listen to Crypto critics and any crypto critical podcast (...Mike green, Jim Chanos, Doomberg) to ensure that my attitude toward the space isn't just wishful thinking or confirmation bias but reflects a balance of viewpoints that can inform my thinking about crypto currencies and digital assets. I'll admit that your podcast and many others have made me very skeptical about the space. My questions/statements are the following: I'm curious why the attacks on Celsius and why now? Celsius has been around since 2018 and is the largest earn/lending platform extant. Why not blockfi and nexo? Why the personal attacks? If Alex is a crook, why wait until now? BTC and crypto in general is tanking...is this coordinated so whales can scoop up "cheap" BTC? One of the biggest differences between Celsius and blockfi and nexo is Celsius does not charge any fees to their customers, nor do they spend any money on advertising, they pay 80% of what they earn to their customers . That is the point of "unbank yourself" - banks make money charging fees to their CUSTOMERS not through business operations. Celsius pays gas fees for their customers. No other company does that which is a significant difference. Celsius has/had the largest AUM due to their commitment to their customers. Before you say "see that Celsius doesn't do that means it's too good to be true" - In the 70s and 80's you could earn 5,6,7 percent on a savings account. Additionally anyone who works in business is aware of the significant dollars that need to be funneled into non core business functions - costs which get passed on to customers. One of the reasons that despite the astronomical amounts of money thrown at it health"care" only continues to get more, never less, expensive with more and more costs transferred to "consumers". Alex has been hosting AMA's since the companies inception. He routinely goes over the companies business operations and mission on each AMA. The company does not just engage in rehypothecation but also owns a BTC mining operation in Texas. He has been the most transparent CEO I've witnessed - that doesn't mean he isn't wrong or even a crook but it does mean that he's comfortable in an environment - weekly AMAs and interviews - than any CEO I've observed. Even the most sociopathic of crooks has a difficult time maintaining that public persona consistently. As Crypto Critics is acutely aware, if Celsius blows up and if Alex is as rich as he says he is, he will ride off into the sunset in a better position than he started. It's the Celsius employees and customers who will be hurt, as is always, always the case. I'm no angel. I pulled my cost basis and a bunch of profits before all this happened however there seems to be a sadistic glee around Celsius problems that smacks more of a coordinated attack on the company to drive prices lower than any humanitarian effort to help/educate the plebs. Respectfully, Nucemd

[@CryptoCriticPod]

We covered Celsius back in September 2021 and also discussed BlockFi and Nexo. Alex has a mixed history and all three of us has discussed it before. Celsius absolutely spends money on marketing. They do engage in re-hypothecation and say it in the terms. The reason interest rates have fallen since the 70s and 80s is not additional costs, but because the RFR is lower.

[@earnthis1]

Don't trust banks with your money, trust ME!!!!!!! lolololololol Yiokes!

[@shauncreed1315]

algorithm

[@AdrianTechWizard]

You have FACES!?!!

[@CryptoCriticPod]

At least some of us

[@username-videos]

They're actually face NFTs.

[@jkiley4466]

Well now at least it's clear which Google AI project Bennett and Cas were created from now. Don't try to throw us off with those deep fake likenesses. We know what is real!

[@volvo09]

@@username-videos hahahaha!!

[@CryptoCriticPod]

Or do you?

[@pepecow235]

Mike is a real squeeker, confirmed.

[@Catechumen_01]

TBTF crypto?

[@yourdude5260]

inCEL Token