Thursday, March 28, 2024

Quebec Pension Fund loses almost entirety of its Celsius investment in less than ten months

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In accordance with native information outlet LaPresse on Wednesday, the Caisse de dépôt et placement du Québec (CDPQ), an institutional investor chartered with managing retirement belongings in Canada’s predominantly French-speaking province of Quebec, wrote off virtually the whole lot of its CA$200 million ($154.7 million) funding in troubled cryptocurrency lender Celsius Community. 

The transfer got here simply ten months after the CDPQ and development fairness agency WestCap made a joint funding of $400 million into Celsius at a valuation of $3 billion. At the moment, Celsius boasted over 1,000 workers, $25 billion in complete belongings and $850 million in cumulative curiosity paid to depositors.

Nevertheless, as an unregulated and centralized entity, a depositors’ belongings should not protected within the occasion of losses, neither is the agency subjected to any restrictions on using leverage. Through the onset of this 12 months’s crypto winter, the sudden and violent crash of Bitcoin (BTC) and different digital belongings left a $2.85 billion hole in Celsius’ web belongings. Because of this, it suspended withdrawals on the accounts of almost 1.7 million clients in June.

Associated: Worried about inflation’s impact on your retirement savings? Invest in cryptocurrency

It seems that the loss on Celsius represents solely a negligible fraction of the CDPQ’s portfolio. By June 30, the CDPQ managed a mixed CA$391.6 billion in total assets (or about $303.4 billion), lowering by 7.9% previously six months. The entity is at the moment evaluating its authorized choices in opposition to Celsius, though it has not shared any particulars. In accordance with court docket filings, Celsius is scheduled to run out of money by October.