Celsius Network Weekly AMA– October 23, 2020

With Alex Mashinsky, Zach Wildes, and Tal Bentov, Director of Lending Operations

This week’s AMA begins with some updates from Alex, followed by community questions. As always, the timestamp from YouTube is hyperlinked to each question below.

Summary: Alex starts today’s AMA with the exciting news that Celsius is approximately $100 million away from $2 billion in assets under management (AUM)—a remarkable milestone. Celsius has several new promo codes out, including one for first-time depositors (START), who get $10 when they enter the code and deposit $10. The most recent update to the Celsius wallet also saw the addition of biometric (face ID and fingerprint) login to the app. Biometric login now replaces 2FA code entry, and makes the app experience so much smoother—go try it out!

This AMA was focused on loans, and Tal, the loan queen, did not disappoint. She discussed the new loan promo code (TREAT)—use the code and take a loan (before Nov 1st) less than $3,000 for a $50 bonus, and any loan above $3,000 earns a $100 bonus. Users in the UK should have loans re-enabled in the next week or so, and if it isn’t in time before the TREAT promo code expires, then UK users will get their own, special promo code for loans. Furthermore, Alex and Tal discussed Celsius’ future goals of offering loans in local fiat currencies (Euro, AUD), default options for longer loan periods (even though current loan terms can always be extended), and the possibility of building your credit score by Celsius reporting loan data to credit bureaus once Celsius is large enough.

Finally, this AMA had a few emotional moments regarding Celsius success stories and the impact that financial freedom can have on a person’s life. This story from Yvonne is a really moving one about how Celsius changed her life for the better. Alex circles back to this at the end of the AMA here, driving home the point that we cannot rely on the old system, and we all have to vote with our money for a new system that acts in our best interest.

And if you’d like to earn interest on your crypto, gold, and stablecoins with Celsius, scroll to the end for instructions on how to get $20 in BTC when you sign up.

Celsius Updates

1. $100 million shy of $2 billion AUM. We just need a little bit more in deposits from everyone and then we can really celebrate! AUM has been climbing like crazy for the past several months and continues to do so.
2. 1% loan with a bonus. 1% loans are still available, and now if you use the promo code TREAT by the end of the month, you’ll get a $50 bonus if your loan is between $500-$3,000 and $100 bonus if your loan is above $3,000.
3. CBDCs are so hot right now. Central Bank Digital Currencies (CBDCs) are being proposed by Central Banks around the world. If the Central Banks have digital currencies that they can give you directly, then you can have direct interactions with the Central Banks—cutting out traditional banks as the middle man.
4. Inflation is real. This year, the US Federal Reserve has printed 20% of all of the US dollars that have ever existed. This is typically measured in prices (which may not be going up yet), but when you dilute the total amount of money available, then this will lead to inflation. Banks in the US will need to be bailed out, and European banks will need to be nationalized. And of course, CBDCs will be subject to the same inflation that traditional fiat currencies see as well.
5. HODL is more than just a meme. If you hold your crypto for more than a year before selling it, in most countries this will affect how you are taxed on it. Long-term capital gains taxes are generally lower than short-term capital gains taxes, so use this to your benefit if you can!
6. Don’t sell large orders on Uniswap! Over the past few days, CEL’s price dropped down to below $1—and Alex bought 300 ETH worth of CEL at $0.98. The price has quickly recovered, and this drop was caused largely by one person selling $165k CEL on Uniswap in a single transaction (and other holders dumping when they saw the price dump). Remember—Uniswap is not a normal orderbook and you will experience considerable slippage with large buys or sells. For buying or selling large amounts, instead contact otc@celsius.network. You’ll get great service and won’t have to worry about slippage.
7. Paul Tudor Jones loves Bitcoin. Paul Tudor Jones is a hedge fund manager who currently manages ~$22 billion. He recently (and famously) has allocated 2% of his fund’s assets into Bitcoin as a hedge against inflation. According to Paul, “I think we’re in the first inning of Bitcoin.”
8. A very personal message from a Celsius community member. Celsius is still looking for more Celsius success stories—so please reach out if you’d like to put yours on camera. Yvonne’s story is a really moving one about how Celsius changed her life for the better—just go watch it.
9. Biometric login LIVE in the Celsius App. You are now able to use biometric login (either Face ID or Fingerprint) as your 2FA authentication method. The login experience and other places in the app where you need to use 2FA is much smoother now—go try it out!
10. PayPal is big, but LINE is bigger. PayPal moving into the crypto space is huge for more widespread adoption, and will be incredibly bullish for companies like Celsius. However, just keep in mind—LINE (Celsius’ global partner offering Celsius’ services to their customers) has twice as many customers as PayPal.
11. Interviews with Alex. Alex was on an episode of FMTV with Miko Matsumara, and also hosted Brock Pierce for a recent episode of MOIP.
12. Celsius Team CEL Unlocks. Celsius is planning to release 25 million CEL tokens to their employees once CEL token is above $1.50 for 10 days. However, at most, 10% of these will unlock immediately, while most employees are locking their tokens up for 2–3 years.
13. Celsius is damn good at what they do. Other crypto competitors not doing well is not good for Celsius—it’s overall a bad thing for the industry. However, Celsius is focusing on being the best at what they do—lending and interest income. Celsius is profitable and continues to grow.
14. Promo code for new users! A brand new promo code for new users or users who haven’t deposited yet—START. Deposit $10, and get $10 in USDC. Simple.
15. The loan desk has been busy. Lots of loans this week—people love the promo code! Several thousand loans have been taken this week, with more than 50% of them being first-time borrowers. Although UNI was just listed on Wednesday, users have already taken loans against it!

Community Questions

Q: Can we make loan repayments using CEL token directly from our accounts?

Tal: Yes, of course you can! We actually updated the loan payment flow with the latest app update. Go to your loan details and there’s a button to choose which coin you want to deduct for your loan payment every month. You can also change the coin every month, and can even use a bank wire if you’d like.

Q: Can Celsius offer loans with longer payback periods, like 5-year or 10-year loans?

Tal: Of course we can! Right now, we offer up to three years but you can always extend the loan—just contact us and we can do it, with no fees of course! We probably will be adding longer default options in the app in one of the next updates.

Q: Can you take a loan in CEL token?

Tal: Right now we only lend fiat and stablecoins, although we are looking into options for future products. We love it when people share what they want to see in future updates, so please reach out if you have any ideas!

Alex: Yeah, we are adding swap inside the app and we will add additional options to borrow—the issue is more about legal restrictions in each country.

Q: Will we be able to borrow in other fiat currencies like Euro or Australian Dollar anytime soon?

Alex: Yes, we applied for licenses in Australia that will allow us to accept local currencies and issue loans in it—we’re just waiting on the regulators.

Q: Is there an update on whether UK users can take loans again?

Tal: Probably next week—we’re really close to being able to go live again with loans in the UK. Also, we promise that if the TREAT promo code isn’t available anymore, we’ll create a special promo code for UK users.

Q: If I take a loan with Celsius and pay it back on time or early, will that improve my credit score?

Alex: No. We do not do credit checks or income verification (everyone is pre-approved for loans), and we do not report to the credit agencies. I think when we’re big enough—right now we’re at about 200,000 users—once we hit like half a million or more, then I think the rating agencies will consider us large enough and take our reporting into consideration.

Q: I took a loan for 12 months—can I pay back the loan and release my collateral early?

Tal: You can close the loan whenever you want, with no fees! The only requirement is that you pay the first six months of interest if you close it before then. Most of our users are holding on to their loans, and many are extending them or taking more loans as well. You can also pre-pay your interest if you’d like, just contact us and we can set that up (loans@celsius.network).

Alex: I’ll spill the beans here—for 700 years, the banking concept has been to take as much from a customer as you can with fees once you already have them as a customer. But Celsius is doing something different. If we can keep a customer for life, then that’s a much better situation—everything we do is focused on making the customer happy.

Tal: We also want to remind everyone—a big reason why users come to us to close loans early is because the collateral went up in value. But you don’t have to close the loan, you can just refinance it. This way you keep your loan, but we also release more of your collateral to start earning interest again. Again, all you need to do is write us—we use the 10-day low of the coin when calculating its value—and it’s a very simple process that we’re actually working to automate in the near future.

Q: What is Celsius doing to contact the large number of users who have signed up but have not deposited into the Celsius app?

Zach: Part of the reason we created the START promo code was to help encourage these users to deposit, and hopefully we can send them a push notification letting them know about it.

Alex: Yeah, just to add to that, I think everyone has their own clock. Some people hear about Celsius once and that’s good enough for them, and they put coins in. But for some people it can take months or years to deposit into the app, because they have a much higher bar for trust—or maybe they’ve had a bad experience somewhere else in crypto. Our job is to try and help more and more users cross that trust barrier, which is why we focus so much on transparency and security.

Q: Will Celsius ever offer a debit or credit card? Give the people what they want!

Alex: Well, unfortunately what the people want is to spend their money. I don’t want you to spend your money! I don’t want you to buy all of those expensive presents for everyone at Christmas—because the joy from those lasts for a few days and then your capital is earning half of what it used to. You feel a little bit better, but now you have to work twice as hard because you spent half of your money. The goal is to spend from your interest, not from your principal—and that’s when you’ll reach true financial freedom.

Q: Would Celsius survive a run on their holdings (if all of Celsius’ users withdrew their funds)?

Alex: Yes, we have plenty more assets than all of our deposits put together, not even including the 350 million CEL token in our treasury. We are allowed to call back all of our loans with our retail users and our institutional borrowers—which is not something that we want to do, but it is something that we could do if we needed to. We do not practice fractional reserve lending like the banks do.

Q: If I want to borrow more, can I add to an existing loan, or do I have to take out a new loan?

Tal: You can do both! Some people prefer to have multiple loans, but we can always refinance your loan to be bigger—as always, with no fees.

Alex: And if you need to move around the size of your loan, or change what your LTV is—that’s fine, we don’t have any fees. What we care about is our users keeping their coins with us, so we can keep lending to institutions at the highest rates possible. We just lent out UNI at 15%—when we launched UNI, we weren’t sure how much the institutions would pay. But now we need more UNI—we don’t have enough! We may even be able to raise the rates higher.

Q: When will Celsius come to Germany? Please!

Alex: You can use us in Germany—one of our partners, Bitwala, offers our services through our API. When you deposit with them, you are using Celsius’ services. Germay has new laws that go into effect January 1st, and will make a lot of financial providers change their offerings or stop providing their services. So we just wanted to get ahead of this and partner with Bitwala to make sure their were no interruptions in our service.

Q: With companies like PayPal and MicroStrategy purchasing Bitcoin, will you be reaching out to these companies to offer interest and loans?

Alex: We already have many institutions, family offices, and corporations that work with us—we have something like 360 institutions that have been onboarded. We do have a bit of a separate process for onboarding corporate customers, but one thing I can assure you with pride—we never pay one of these companies more than we pay you. No one gets a special rate—the guy with $10 gets the same rate as me, someone who has millions in Celsius.

This is one of our cardinal principals. We believe that you get much more by giving than receiving. Everybody that you meet, do the best that you can for them. I’m just preaching what other people have been saying for thousands of years.

Because there is so much distress in people’s financial lives, and because we get so little education on this, people just don’t know what to do. So people give up, and assume that they can’t be good at finance—but it’s not just for the smart people! Go to Wall Street—they’re not smart, they’re just greedy.

We’re not going to stop the old systems by lobbying in Washington, or voting for this or that president, or helping people with financial literacy. You have to create a new system! And each one of us has to vote with our wallet, and decide—are you voting for the old system? Or are you voting for the new system?

The reason that Yvonne’s video has touched me so much is that for her entire life, she voted for the old system. Her entire life, she dedicated herself to help other people reach retirement—everything I’m talking about trying to do, she was trying to do from her heart as well. And then when she was facing the abyss, when she was facing the end of the world, with her daughter having problems—there wasn’t anybody there. There wasn’t anybody there.

And it’s true for all of you. If you think that you’re a special case, there is no special case—no one cares. All you have to do is vote for the other system that is acting in your best interest. So we’re gonna be here every week, and we’re gonna make sure that everybody gets the same chance, but you’re gonna have to make that choice. You have to decide if you believe all of the people that brought you to this point, or if you’re going to believe the people that want to take you forward.

Want to unbank yourself with Celsius (and get a free $20)?

• Install the Celsius wallet (https://celsius.network/get-the-app/)
• Use a referral code during registration (137247d31d)
• Deposit $200 of crypto or stablecoins

You will earn $20 in BTC once you hold your deposit for 30 days

…And click here for a step-by-step guide for onboarding with Celsius.