Bankrupt Celsius Network Channels $75 Million of Ether to Figment Staking Service – What’s Going On?
The bankrupt crypto lender Celsius Network has staked close to $75 million worth of ETH via the staking service Figment, on-chain data has revealed.
The massive transfer from Celsius to Figment was made via fourteen separate transactions made between May 10 and 12, and totaled some 40,928 ETH or about $74.5 million by Tuesday’s exchange rate.
The funds were sent to a smart contract labeled “Figment: Eth2 Depositor 1” by blockchain explorer Etherscan.
The same funds were then moved to Ethereum’s Beacon Deposit Contract to be staked on Ethereum’s new proof-of-stake blockchain, the data from Etherscan showed.
The transfer is one of the largest that have been made since Celsius filed for Chapter 11 bankruptcy in July last year.
There has been no word from Celsius or any of the parties involved in the firm’s bankruptcy proceedings about why the transfer was made, but one theory is that Celsius simply is trying to earn a yield on some of the assets it holds while the proceedings are ongoing.
Already, Celsius has over 158,000 ETH – worth some $287 million by today’s rate – staked via its own staking pool on Ethereum, according to data from 21Shares and Dune Analytics.
A question that has not yet been answered is therefore why Celsius chose to transfer so much ETH to Figment instead of staking it in its own pool.
The average annual yield on staking via Figment currently stands at 5.6%, while the Ethereum network itself now can pay out close to 9% to those staking on their own, according to Stakingrewards.com.
Celsius Network collapsed in the summer of 2022 as prices of most major cryptoassets crashed in the market.
It is believed that a key part of Celsius’ collapse was its inability to withdraw ETH it had staked and locked via staking providers like Lido Finance, as its own depositors rushed to withdraw their funds from Celsius.
