Swan Bitcoin CEO Cory Klippsten has a problem with Celsius.

He believes that the crypto lending platform, which sparked his interest following the collapse of the TerraUSD luna (UST) stablecoin, has not been forthcoming about its vulnerabilities and misled investors.

“It’s so opaque what’s going on in Celsius,” Klippsten said on CoinDesk TV’s “First Mover” program Tuesday, a day after Celsius’ announcement that it would freeze withdrawals due to “extreme market conditions.”

Celsius’ problems have led to widespread fears about crypto’s future and contributed to the four-day freefall in prices to two-year lows.

Klippsten said that Celsius first sparked his interest last May, and that his concerns about its model and what he considers false promises have increased.

By Friday, May 13, days after the news of Terra’s fall, Celsius announced that it had pulled half a billion dollars worth of user funds from Terra’s Anchor Protocol, news that rippled throughout the cryptocurrency industry.

“That was really stunning to hear,” Klippsten said. “That a professional risk management team had even bothered to be playing with an obvious Ponzi scheme like Luna and furthermore, to be pulling it out a day before the collapse.”

This isn’t Celsius’ first encounter with controversy. In December of last year, it lost nearly $55 million dollars, or about 896 of wrapped bitcoin (wBTC), after BadgerDAO, a decentralized autonomous organization, was hacked for upwards of $120 million.

Klippsten adds that Celsius kept parking user funds in obscure no-name decentralized finance (DeFi) protocols, which are risky and not good at operations. “It’s a big, big, big red flag.”

In April, Celsius banned new transfers by non-accredited investors on its U.S. platform, limiting who could add new assets and earn rewards. Nearly five months prior, the crypto lending firm had to replace its former CFO, Yaron Shalem, after Shalem was arrested “for committing fraudulent offenses in the field of cryptocurrencies.”

Celsius’ marketing has been misleading , Klippsten added. “They make it sound like a better bank, and they make it sound like a high yield savings account,” he said.

The peer-to-peer platform is intended to facilitate crypto lending, and attracts users by returning 80% of its revenue to users in rewards, while the firm used the remaining 20% to fund the project’s expansion.

Celsius users are more likely to be unsecured lenders, Klippsten notes. “You’re an unsecured creditor, and they can do whatever they want with your coins out the back end, essentially trading it like a hedge fund. You don’t have any rights to your coins,” he said.

Yet Klippsten said that crypto lending models are not inherently troubled. For those who must seek yield, “there’s definitely going to be a spectrum, and there will be some that are much more transparent,” he said, adding that those better managed platforms are likely to have “much stronger risk management, and frankly, lower yields on offer. You have to make that choice for yourself.”

Celsius’ freeze on withdrawals and transfers, and earlier terraUSD debacle could be a wake-up call, allowing investors to see the fallacy of a risk-free, high-yield product.

Celsius’s CEL token was recently trading at about 64 cents, according to CoinMarketCap data, placing the firm’s market capitalization just above $161 million.

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