The Caisse de rentes du Québec loses almost all of its Celsius investment in less than ten months
"For us, it's clear, when you look at all this, we arrived too soon in a sector that was in transition", says CEO Charles Émond.
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According to local media outlet LaPresse on Wednesday, Caisse de dépôt et placement du Québec (CDPQ), an institutional investor responsible for managing pension assets in the majority French-speaking Canadian province of Quebec, has written off almost all of its CA $200 million ($154.7 million) investment in struggling cryptocurrency lender Celsius Network.
The move came just ten months after CDPQ and growth capital firm WestCap made a joint $400 million investment in Celsius at a $3 billion valuation. At that time, Celsius had over 1,000 employees, total assets of $25 billion, and $850 million in accumulated interest paid to depositors.
However, as an unregulated and centralized entity, depositors' assets are not protected against losses, and the firm is not subject to any restrictions on the use of leverage. At the start of this year's crypto winter, the sudden and violent crash of Bitcoin (BTC) and other digital assets left a $2.85 billion gap in Celsius' net assets. As a result, it suspended withdrawals from the accounts of nearly 1.7 million customers in June.
Related: Worried About the Impact of Inflation on Your Retirement Savings? Invest in cryptocurrency
It appears that the loss on Celsius represents only a negligible fraction of the CDPQ's portfolio. As of June 30, the CDPQ had combined total assets under management of C$391.6 billion (or approximately $303.4 billion), down 7.9% over the past six months. The entity is currently evaluating its legal options against Celsius, although it did not share any details. According to court documents, Celsius should work...
"For us, it's clear, when you look at all this, we arrived too soon in a sector that was in transition", says CEO Charles Émond.
New
According to local media outlet LaPresse on Wednesday, Caisse de dépôt et placement du Québec (CDPQ), an institutional investor responsible for managing pension assets in the majority French-speaking Canadian province of Quebec, has written off almost all of its CA $200 million ($154.7 million) investment in struggling cryptocurrency lender Celsius Network.
The move came just ten months after CDPQ and growth capital firm WestCap made a joint $400 million investment in Celsius at a $3 billion valuation. At that time, Celsius had over 1,000 employees, total assets of $25 billion, and $850 million in accumulated interest paid to depositors.
However, as an unregulated and centralized entity, depositors' assets are not protected against losses, and the firm is not subject to any restrictions on the use of leverage. At the start of this year's crypto winter, the sudden and violent crash of Bitcoin (BTC) and other digital assets left a $2.85 billion gap in Celsius' net assets. As a result, it suspended withdrawals from the accounts of nearly 1.7 million customers in June.
Related: Worried About the Impact of Inflation on Your Retirement Savings? Invest in cryptocurrency
It appears that the loss on Celsius represents only a negligible fraction of the CDPQ's portfolio. As of June 30, the CDPQ had combined total assets under management of C$391.6 billion (or approximately $303.4 billion), down 7.9% over the past six months. The entity is currently evaluating its legal options against Celsius, although it did not share any details. According to court documents, Celsius should work...
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