U.S. and state regulators have been taking aim at crypto rewards platforms such as BlockFi and Celsius for the last year. In a direct blow, the latter has agreed to stop paying rewards to non-accredited (read: financially well-off) U.S. investors on any new deposits starting April 15.
Accredited investors will still be eligible for rewards, as will non-accredited customers’ assets that are already held by Celsius. The new rules don’t apply to non-U.S. customers.
The change will dent Celsius’ business model, which works like this: Customers store their crypto assets with the company and earn interest (i.e., rewards) in the form of more coins and tokens. For instance, Celsius currently offers over 7% annual returns on stablecoins such as USDC and Tether, 5.5% for Solana and over 3% for wrapped Bitcoin. Celsius then loans those pooled tokens out at higher rates to borrowers.
Decrypt has the story.
