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CDPQ Posts $33.6 Billion Loss (H1 2022) After Writing Off US$150 Million in Celsius Network

Montreal Gazette | Frédéric Tomesco | Aug 17, 2022

Caisse de depot - CDPQ Posts $33.6 Billion Loss (H1 2022) After Writing Off US$150 Million in Celsius NetworkThe Caisse de dépôt et placement du Québec is considering its legal options after writing off its entire US$150-million investment in cryptocurrency lending platform Celsius Network.

“Clearly, things didn’t unfold as anticipated,” chief executive officer Charles Emond said Wednesday. “No one at the Caisse, starting with me, is happy with the result in this file. That being said, one shouldn’t lose sight of the fact that this is an exception in our venture capital portfolio, which has performed well,” returning 35 per cent annually over about seven years, he added.

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New Jersey-based Celsius filed for Chapter 11 bankruptcy protection in the U.S. last month following a decision to freeze customer accounts. The Caisse and WestCap led Celsius’s US$400-million investment round in October.

A net investment loss of $33.6 billion slashed net assets down to $391.6 billion as of midyear, the Caisse said Wednesday in a statement. The first-half performance still topped that of the Caisse’s benchmark index, which dropped 10.5 per cent.

Charles Emond, Caisse CEO:

It’s clear that we got in too early, in a sector that was in transition, with a company that had to manage an extremely fast growth rate.  Although Celsius had a “very established” plan, “sometimes you lack time.  All the risks materialized in a very short amount of time.  The due diligence performed on that asset was quite extensive, with many experts and consultants involved. The team came in cautiously.

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Asked if the Caisse was still interested in betting on the cryptocurrency industry, Emond was curt: “No.”

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NCFA Jan 2018 resize - CDPQ Posts $33.6 Billion Loss (H1 2022) After Writing Off US$150 Million in Celsius NetworkThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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