In July 2022, Celsius filed for a Bankruptcy case. On Monday, despite being Bankrupted, the token value jumped to USD 1.63 and is now trading at a higher price than before. Celsius has been largely affected by the current cryptocurrency market situation and have halted user withdrawals.
On June 12, the token price had fallen to 15 cents when they informed through a public announcement that they would disable withdrawal. Since then, the price has experienced a 10-fold increase in 60 days and approximately 300 percent gain since they filed for bankruptcy.
The Token Of Bankrupt Lender Celsius Increases Due To A Short Squeeze On Twitter
Per the Director (Gerber Kwavasaki Wealth And Investment Management), many speculative assets such as Celsius tokens are trying to recover and surging as growth equities.
Communities have driven a short squeeze on Twitter and trended #CELshortSqueeze to speculate about the Celsius token. Meanwhile, many traders have bet on the CEL’s price by shorting the coin on different cryptocurrency exchanges. Also, many people had identified an opportunity similar to GameStop Stock short Squeeze.
What Is Short Squeeze?
Short Squeezes are real-time price increases that compel traders to cover their shorting bets. Before celsius, Crypto Voyager Network showed a great example of the short squeeze a month ago.
Disabling the Celsius Token transfer means that a huge percentage of CEL’s total supply is still locked, and only small fractions are available to trade on different cryptocurrency exchanges.
Recently FTX has mentioned that they host approximately 4.5 million CEL tokens, which combines the number of tokens available on all the exchanges. A recent analysis by a crypto data analytics firm, Dune, supported this.
Short sellers bought CEL on FTX and deposited it in a hidden wallet to lodge a high-priced order. A lot of traders placed a sell order at 100 USD.
Samir Kerbage (Asset Manager and Crypto Analyst) believes that as the circulating supply is quite minute, it is very much possible to cause a short squeeze. However, there won’t greatly impact the crypto market in general and would not sustain for quite a long time.
Despite a short Squeeze, the CEL token is still down by nearly 70 percent from its all-time high.
CEL Token’s Technical Analysis
The price spiked Monday by 20 cents to 1.63 USD from 1.43 USD. There were approximately 300,000 CEL short positions closed on FTX cryptocurrency exchanged. Also, in the recent 24 hours, the liquidation has surpassed USD 480000, according to the analysis done by Coinglass.
Many analysts predict CEL’s long-term growth positively, while Kerbage is doubtful.
Kerbage stated that Celsius Investors who create a Squeeze have a tiny upside. There is always a big downside of token begging going back to zero, which might dump other crypto tokens too.