Celsius Network
Yield platforms that promise 18% APY on crypto deposits are taking risks customers don't understand.
2017 → 2022
$750M
Crypto/Fintech
USA
IdeaProof AI Failure Score
Full Analysis
Celsius Network offered crypto lending with yields up to 18% APY, attracting 1.7 million users and $25B in assets under management. CEO Alex Mashinsky promoted Celsius as "safer than banks." In reality, Celsius made increasingly risky bets—leveraged trading, DeFi yield farming, and illiquid investments—to generate the promised returns. When crypto markets crashed in mid-2022, Celsius couldn't meet redemptions and froze withdrawals, revealing a $1.2B hole in its balance sheet. Mashinsky was arrested and charged with fraud. The lesson: when returns seem too good to be true, they are—and the customers who trusted "crypto banks" paid the ultimate price.
Could This Failure Have Been Prevented?
IdeaProof's AI validates market demand, competitive positioning, and business model viability in minutes — catching the exact issues that sank Celsius Network.