Ever since bankrupt cryptocurrency lender Celsius froze withdrawals in June, client funds have remained in limbo. Now, the leaked audio shared with CNBC reveals a preliminary plan to compensate for them.
The company wants to issue an “IOU” cryptocurrency to customers who have signed up for some of its accounts.
Registration was provided by Tiffany Fong, who claims to be one of 500,000 Celsius clients with funds locked into the platform. Fong says he received the audio from a self-identified employee, who remained anonymous during their communications.
CNBC was unable to verify that the leaked audio is the entire exchange of information from an internal meeting on September 19. 1. However, CNBC spoke to former employees who verified that the registration was authentic. In the audio, Guillermo Bodnar, Chief Technology Officer, says the plan is in the “early stages”. What was presented may have changed in the weeks following the call.
In the registration, Celsius co-founder Nuke Goldstein outlines a compensation plan for clients who have deposited assets into Celsius’s “Earn” account, for which Celsius had promised returns of up to 17%.
Goldstein said Celsius will release “wrapped tokens,” which will serve as the IOU for customers. Tokens represent the relationship between what Celsius owes customers and the resources they have available. He said that if customers wait to redeem their tokens, there’s a better chance the gap between what Celsius has and what he owes will be smaller.
This is a risky bet on an increase in value for a nascent token from a company that has just gone bankrupt. Goldstein said the value is likely to increase because Celsius has revenue from its mining, staking ETH and other coins that could go liquid.
Celsius also intends to allow customers to redeem these tokens, according to Goldstein. He said the tokens can be redeemed on Celsius for likely less than they owe or on crypto platforms like Uniswap, allowing the market to determine the value of the tokens.
In this photo illustration, the Celsius network logo is displayed on a smartphone screen alongside Bitcoin cryptocurrencies.
Rafael Henrique | SOPA Images | light rocket | Getty Images
Reimbursement isn’t the only plan Celsius has in the works. In part of the registration shared exclusively with CNBC, Bodnar said the company is also building a transaction management system, designed to track the company’s blockchain assets. This would include the assets, the price at which they were purchased, and how much they were worth when they were sold.
Celsius, which claimed to handle billions of dollars in customer assets, has never had sophisticated software to properly manage and track its assets, according to sources familiar with the company. These sources, who asked not to be named for confidentiality reasons, also said that the data was plotted manually, on a simple Excel spreadsheet.
In the phone call, Bodnar said that the goal for building this new system is transparency.
“…[T]transparency is reflected not only in the way we communicate, but by ensuring that everything done within our platform is traceable, verifiable, end-to-end – we have nothing to hide, “he said.
Goldstein also pointed out that there was a lot of misinformation about the company circulating on Twitter and that employees should only rely on the information provided in court records and city halls run by CEO Alex Mashinsky.
“If you go on Twitter, bring an umbrella because it’s raining bull —- over there,” Goldstein said. “This is your chance to get the truth. If we don’t tell you the truth about what we know, we go to jail. Now, I don’t know if we go to jail … but it’s not okay.”
In the question and answer part of the event, an interrogator asked where the employees were in terms of releasing the funds blocked by the platform. Goldstein said employees won’t have priority over customers.
“Employees aren’t the last or the first,” Goldstein said. “You are a customer too. We are a customer. That means we are on the same level as customers.”
CNBC reached out to Celsius for comment on their repayment schedule and the status of their transaction management system, but the company did not respond.
LOOK: Bitcoin drops below $ 19,000