Known as two of the giant names in the world of blockchain and cryptocurrencies, Celsius Network and Bitcoin.com have announced a brand new partnership, making one of the single biggest mergers between two blockchain/crypto businesses.
While this is the case, unless you're one of those people out there that keeps themselves abrest of what's been going on in the industry. A name like Celsius Network isn't going to mean too much to you, even though it's one that you should absolutely consider learning more about.
It's one of the few services out there that started off with the express desire of flipping financial solutions on their head; serving, according to them, in a way that's in the best interests of its users and holders of Celsius crypto.
And this gets us into the crux of our discussion here.
While it's only really been around for a couple of years - having been established back in 2017 - the Celsius Network wanted to do for the cryptocurrency market and its users what the early stages of the futures and margin trading/lending did for investors.
Established in London by its now CEO (Alex Mashinsky), COO (S. Daniel Leon), CMO (Keith Baumworld) and CTO (Nuke Goldstein), Celsius made use of Ethereum and its ERC20 token in order to create its own unique blockchain and crypto.
Its goal? To supplant the commonly used Futures Market and margin trading solutions, allowing them to operate in a more reliable, decentralized way; thereby creating a fairer system that benefits those interested in lending their own currency to potential borrowers and investors.
With the intial concept being brought forward in 2017, the team announced that there would be a dedicated Celsius ICO to get its platform off the ground, and become an intercontinental financial solution.
So how successful was this fund raise? By its conclusion in March 2018, Celsius managed to successfully raise over $50 million.
'Unbank yourself,' is the title that the company sports on its platform, and there's every incentive for people to actually get involved. According to the team, users can earn up to 7% interest a year on the crypto they deposit into the platform. While the number doesn't sound so spectacular if we compare that to banking interest rates (1-2%): the writing is pretty much on the wall.
"The answer is very simple — banks could also pay you 7%, they just don’t want to." The system that centralized banks have in place for investors is an intrinsically unfair one. This is in spite of the fact that they, in many instances, can easily see bumper profits of 14% annually, Celsius admits:
"Most banks typically have between 14–25% return on their capital, so by paying customers 1% in interest, they’re keeping over 80% of the profits and distributing these earnings to their shareholders in the form of dividends and share buyback."
Currently, Celsius allows users to make deposits in 19 different cryptos, with a further 7 coming to the mobile app soon, including TRON and EOS. The platform professes to sharing roughly 80 percent of its revenue with its community, it's certainly earned itself its fair share of supporters.
Along with offering investors promising rates of interest, providing they follow the KYC procedures, users can also secure loans thanks to these same investors. So long as users have collateral in the medium of any of the (previously mentioned) cryptos that Celsius supports.
Depending on which crypto you provide for collateral against what you want to borrow, Celsius provides three interest rate levels: 4.95, 6.95 and 8.95% with a minimum loan of $1,500.
Celsius prides itself on a streamlined system for lenders, borrowers and those just looking to make peer to peer payments without the premiums charged by the likes of Coinbase. Those using the mobile app can quickly see some pretty impressive statistics related directly to the platform.
It's an entirely different animal from the one that was kicked off by Mashinsky and co back in 2017. With 41,000 wallet holders, and a total of 20,411 Bitcoin deposited by them means that there is more than $323 million of liquidity.