US regulators say multi-billion-dollar crypto lender Celsius was operating like a ponzi scheme

pcgamer.com:

In June a multi-billion-dollar cryptocurrency lender called Celsius went bankrupt, with its court filings showing a $1.2 billion black hole in its finances. Celsius was a crypto trading and loan company that at one point boasted over $5 billion in 'assets'. It was only founded in 2017 but rapidly attracted crypto traders and speculators: you could deposit crypto with Celsius with the promise of high-yield returns, or take out a cash loan secured against your crypto holdings.

Then, it spectacularly crashed and burned with well over a billion owed. Almost unbelievably the company tried to put a positive spin on the news—but given that the biggest losers were going to be 'normal' investors, the collapse attracted the attention of both the US Department of Justice and Vermont state regulators, who have begun turning over rocks in order to investigate what happened.

To put it mildly, the regulators don't like what they see. The Vermont Department of Financial Regulation has now filed against the firm in New York, and the state regulator is «especially concerned about losses suffered by retail investors; for example, middle-class, unaccredited investors who may have invested entire college funds or retirement accounts with Celsius.» The Vermont state prosecutors support the DOJ's request for a legal Examiner in order to protect such interests.

I'll take you into the weeds in a moment but, of all the legalese and claims to come, here is the single most important line in the filing against Celsius: «This shows a high level of financial mismanagement and also suggests that at least at some points in time, yields to existing investors were probably being paid with the assets of new investors.»

This is how a state attorney calls a