Now-insolvent crypto lending company Celsius Network operated in a hectic, chaotic and disorganized manner, according to one former employee.
Timothy Cradle, the platform’s former compliance and financial crimes director, told CoinDesk TV “of sloppiness and mismanagement” at the company.
“Certain teams were too small and communication was a bit poor between departments, and especially across Celsius U.K. and Celsius U.S.,” Cradle said on CDTV’s “First Mover” program. “Celsius wasn’t the exception to what one would expect.”
Cradle said he was motivated to speak out about internal practices within Celsius because the company allegedly betrayed one of its core promises – transparency.
Among oddities, said Cradle, was an onboarding session with a customer at which the Celsius chief financial officer said the company did not engage in trading. “That just didn’t make any sense to me,” said Cradle, noting Celsius had a trading desk and a head of trading.
He noted that trading wasn’t even in Celsius’ risk disclosures that were made to customers.
“I didn’t think there was anything intentional or malicious about withholding that information,” he said. “I just thought Celsius didn’t want people to know how they were generating yield.”
While Cradle said he does not think Celsius should have been compelled to disclose to whom it was lending, the company’s risk disclosure should have provided insight into how it was deploying assets.
Cradle also hinted that alleged market manipulation was taking place, and detailed a conversation during a Christmas party back in 2019. “The CFO and the head of trading at the time mentioned they were active in the market, attempting to increase the price [of Celsius' CEL token],” he claimed.
In another conversation that took place near the end of 2020 between an executive and a compliance team member, Cradle said he heard Celsius was looking to hold prices of the CEL token down in order to trim the bonus pool.
“It seems pretty apparent that Celsius was actively manipulating the price of the [CEL] token,” Cradle said.
“I think someone would have to be frankly insane to trust Celsius with their assets at this point,” said Cradle, throwing shade on the company’s efforts at avoiding liquidation and instead continuing as an ongoing business.
CoinDesk reached out for comment from Celsius but had not yet received a response at the time of publishing.
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