Crypto lender Celsius Network’s native token CEL saw an uptick of around 50% on Tuesday as community members attempted a short squeeze.
See related article: CEL down over 50% since Celsius Network’s withdrawal freeze
- In a short squeeze, bulls attempt to buy out the underlying asset to push up its price and make it more expensive for short sellers to cover their positions.
- Banding together on Twitter, community members decided to boost CEL by buying the native token on FTX exchange, transferring them to decentralized exchanges, and setting sell-limit orders.
- The situation is similar to the GameStop short squeeze in January 2021 which caused GME token’s price to rise by over 1,000% in two weeks.
- While the short squeeze started increasing Celsius’ token price initially, CEL’s price has since come down to around US$0.99 from a high of US$1.55 on Tuesday, according to CoinGecko data.
- The token’s price is down more than 87% from all-time high of US$8.05 in June 2021.
- Celsius halted withdrawals and transfers on June 13, coinciding with the acceleration of the crypto market crash.
- Celsius has hired restructuring attorneys and is exploring asset sales or bailout — the firm said on Monday that it will take time for it to stabilize liquidity and operations.
See related article: Celsius said to be hiring restructuring attorneys, exploring financing options