A lawsuit filed in the New York State Supreme Court by KeyFi accuses Celsius of crypto market manipulation and failure to put in place basic accounting controls to protect customer deposits.
Jason Stone – the founder and CEO of KeyFi, which was partly acquired by Celsius – took to Twitter with the court filing to describe the falling out between the parties.
Stone wrote: "We discovered Celsius had lied to us. They had not been hedging our activities, nor had they been hedging the fluctuations in crypto asset prices. The entire company’s portfolio had naked exposure to the market."
The lawsuit accuses Celsius – prior to Stone coming on board – of having no organized investment strategy other than "desperately seeking a potential investment that could earn them more than they owed to their depositors."
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.