1/33 CEL Token Utility is Essential for Chapter 11 Recovery Plan & Onwards
6 ways to increase CEL utility, build up Celsius' treasury & ensure a bank run NEVER happens again
📽️ @YouTube explainer video:
📝 @Medium article: link.medium.com/lDf9uay4ytb
🧵 👇
2/33 Every great crypto company has a great utility token.
@Binance has $BNB, @FTX_Official has $FTT & @cryptodotcom has $CRO.
When Luna crashed in May 2022, Binance didn’t bat an eyelash at the $1.5 billion loss.
Why?
3/33 Binance has $BNB (market cap of $50 billion at the time of the crash, $42 billion in today’s valuation), at its disposal.
By creating strong utilities around $BNB, Binance also created a war chest, which insulated them from the staggering $1.5 billion loss on Luna.
4/33 In CZ’s own words: “It’s just money, lol…”
5/33 Utility tokens are the backbone of crypto companies.
Utility tokens derive their value from the exclusive access to services they provide to the user.
6/33 The more value they offer, the higher the demand for the token.
This gives users the incentive to hold onto them, thereby increasing the value of the platform’s treasury.
7/33 When banks need a taxpayer-funded bailout every 8 to 10 years, they turn to the FED.
In crypto, there’s no FED to save you from a hack, lost keys or a black swan event BUT your treasury.
8/33 By increasing exclusive incentives for CEL token holders, we will increase buying pressure on CEL Token as well.
The result is a profitable Celsius with a fortified treasury to ensure a bank run like what led to the June 12th ‘pause’ on withdrawals NEVER happens again.
9/33 How will we reward the loyalty of those Celsians who stuck around?
Well, in Celsius 2.0, it pays to be a CEL token holder!
We plan to increase CEL utility by using the existing tier system (with a few modifications).
10/33 We have identified 6 core opportunities to increase CEL utility, with potential for future expansion.
The 6 core opportunities are:
1. Tier System
2. Withdrawals
3. Loans
4. Swaps
5. Yield & Higher In-Kind Yield
6. Access to Funds
11/33 Tier System:
There are 650,000 active users worldwide with a balance of $100 or more currently on the platform.
We need approximately 55% of them to hold CEL token in our tier system.
12/33 Celsius has over 200 institutions, partners & exchanges, including @Visa, @0xPolygon, @bitfinex, @HorizenLabs, @1Inch and @chainlink.
We will require all financial institutions, partners & exchanges to maintain Platinum status (25K CEL or more) to do business with us.
13/33 Here’s a hypothetical ex:
There are 692 million total CEL tokens.
Of that 692 million, approx 50% (330 million) is owned by the Celsius treasury.
Say we get 100,000 users in the Bronze tier, that’s 50 million CEL tokens off the market.
Bronze: 500 x 100,000 = 50,000,000
14/33 50,000 users in the Silver tier ties up another 50 million CEL.
Silver: 1,000 x 50,000 = 50,000,000
15,000 users in the Gold tier reduces liquidity by another 150 million CEL.
Gold: 10,000 x 15,000 = 150,000,000
15/33 Finally, say we get just 3,000 users in the Platinum tier, that’s a further 75 million CEL tokens off the market.
Platinum: 25,000 x 3,000 = 75,000,000
In this ex, we’ve removed 325 million CEL tokens off the market & significantly increased the buying pressure on CEL.
16/33 Withdrawals:
In Celsius 2.0, withdrawal fees are used to buy CEL tokens & increase the value of the treasury.
17/33 Loans:
Crypto loans are back!
Your tier level will be like a credit score; higher tiers will qualify for higher limits & better interest rate payments on loans.
18/33 For Example:
The Platinum tier has access to all five LTV options.
The Silver tier has access to three LTV options — 25% & lower.
19/33 Swaps:
Who doesn’t love easy and convenient swaps?
Your fees & swap limits will depend on your tier level.
20/33 For Example:
A Silver tier member swaps $50,000 of crypto incurring an $18.50 fee. ($50,000 x 0.037% = $18.50)
A non-member swaps $10,000 of crypto incurring a $15 fee. ($10,000 x 0.15% = $15)
21/33 If the non-member swapped $50,000 in crypto (over 5 days), they would incur $75 in swap fees vs. the Silver tier member swapping $250,000 (over 5 days) & incurring just $92.50 in swap fees.
22/33 Yield/Higher In-Kind Yield for all assets
Are you excited for higher in-kind yield on your crypto? Us too!
Based on your tier level, you’ll earn a higher in-kind bonus yield for all your assets on the platform.
23/33 For Example:
Let’s say you’re a Platinum member with 1 BTC on the platform & the current APY for BTC is 5%.
You will earn an additional 25% increase in-kind on your BTC, making the total yield/APY 6.25%. (5 x 25% = 6.25%)
24/33 The weekly reward for a non-member on 1 BTC at 5% would be 0.00096 BTC/per week. (1 BTC x 5% = 0.05 BTC per year / 52 = 0.00096 BTC per week).
25/33 The weekly reward for a Platinum member on 1 BTC at 6.25% would be 0.0012 BTC per week. (1 BTC x 6.25% = 0.0625 BTC per year / 52 = 0.0012 BTC per week).
26/33 Therefore, a Platinum member with 1 BTC on the platform earns an additional 0.00024 BTC per week & 0.01248 BTC per year (0.00024 x 52) over a non-member.
27/33 Access to Funds:
We know timely access to funds is paramount & you guessed it! The higher your tier level, the quicker your access to liquidity.
28/33 While we feel these opportunities are the most effective & easiest to implement right now, we do have ideas for future CEL utilities, including a Celsius VISA credit card, a dedicated customer service line & decreased fees on CelsiusX.
29/33 To conclude, for Celsius 2.0 to succeed, we need to prove to ourselves & future depositors that we can forge a profitable company & prevent a future bank run.
30/33 Not only will the implementation of increased CEL utilities do just that, but we feel capitalizing on these opportunities will significantly increase the value & use case of CEL Token as well.
31/33 The stone that the builder rejected has become the chief cornerstone.
The community is the builder now.
And that stone is CEL Token.
32/33 Your Fellow Celsius Community Members,
Otis, Anthony & Jade
@otisa502 @iTzAnthonyNap @cryptoismyjam
33/33 I hope you've enjoyed this thread on $CEL utilities!
Like, retweet & tag the @CelsiusUCC & @WhiteCase in the first tweet below to spread the word to the #Celsian Community.
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