Celsius's CEL Token Climbs 6-Fold in Mid-Day Spike

Celsius Native token, CEL, records a 600% climb over less than two hours, but analysts predict the massive price fluctuation is due to exchange error and a gigantic short squeeze. According to Trading view, the token's price jumped from $0.18 to over $1.50 in just over an hour, settling at $0.60.

A short squeeze happens when the price of a token rapidly increases, forcing traders who bet against it to purchase it back or "cover" the position to prevent further losses. This forced buying drives the price, causing more shorts to cover and, in turn, causing a massive spike in price.

Some users reported exchange errors simultaneously, which leaves analysts on the fence about what caused the issue in the token's price, according to the Theforcastooor on Twitter. Another user reported "Successful sell orders" followed by the short position not closing in the same thread. Some even claimed they could only close the position at a far from favorable price.

Concerns over Celsius's financial stability in the cryptocurrency markets have been making headlines. Celsius announced late Sunday that it will halt withdrawals, swaps, and transfers to stabilize liquidity under "extreme market conditions." Following this news, Celsius's CEL token fell from 35 to 18 cents on Sunday night.

A Twitter user who goes by the handle Yodaresearch reported that Celsius had paid off $30M of its outstanding debt on Maker, a decentralized finance platform that loans out DAI, a stable coin. This payment is a small piece of the remaining $250M of the BTC collateralized loan. This loan, among other issues, is causing extensive spread questioning of Celcius's financial health, according to a Coindesk report.

Author: Garrett Meifert

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