Image of the Celsius team
Image of the Celsius team. Celsius Network

Of almost all asset classes, cryptocurrency got hit the hardest by the recent economic downturn, caused by the coronavirus outbreak, oil price wars between Saudi Arabia and Russia, and panic selling following the historic low yields of US government bond yields.

However, timely announcements by the two most popular cryptocurrency lending platforms – Celsius and Nexo – have instilled hope that the ecosystem is still functional, profitable for efficient players, and full of promise.

Nexo was first to try to subdue the panic by releasing a blog post, detailing the most evident drivers of economic collapse and reassuring customers that not only will their funds remain safe on the platform, but that the interest rates provided by the service will remain unchanged.

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In addition, the company released a follow-up article, elaborating on the reasons for their resilience – namely their overcollaterisation strategy and the company’s unwillingness to change their rules even for otherwise trustworthy clients.

Celsius followed up by reassuring that the company is fully prepared to have its employees work remotely, ensuring the lack of any interruptions or poor user experience. More interestingly, a further announcement by the lending service states that the $1.5 million in monthly revenues thus far in 2020 is likely to be surpassed in May, despite the disastrous market conditions.

In an interview with CoinTelegraph, CEO Alex Mashinsky also claimed that his company is “the first major cryptocurrency lending platform that is profitable” – although this claim can be disputed by Nexo, who announced upwards of $3 million in profit in just six months in late 2018.

Still, the financial success of both companies in difficult times, with the added regulatory burden of being a cryptocurrency-focused financial institution is a major success, worthy of applause. Their announcements could not have been more timely – as any reassurance about the legitimacy of the cryptocurrency space was more than welcome, following a crash that saw the entire crypto market lose almost half its value in the span of just three days.

And that legitimacy has also resulted in impressive market performance for their respective tokens. Neither CEL, nor NEXO saw a substantial drop during the moment of crisis. Few tokens can assert that their valuation is detached from that of BTC, but none are more deserving of such claim than those of the leading players in cryptocurrency lending.

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