All of this will raise questions about whether the executives knew Celsius was in financial jeopardy at the time of these transactions.
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Celsius Network's three top executives withdrew $56 million in crypto — weeks before the company froze customer accounts, court documents have revealed.
New filings show Alex Mashinsky, Daniel Leon and Nuke Goldstein claimed Bitcoin, Ether, USD Coin and Celsius tokens worth millions of dollars.
Mashinsky stepped down as Celsius CEO last week after a number of customers called for him to step down.
It's now emerged that Leon — the bankrupt crypto lender's co-founder and chief strategy officer — has also resigned.
All of this will raise questions about whether the executives knew Celsius was in financial jeopardy at the time of these transactions.
Meanwhile, there are fears that hundreds of thousands of customers could end up at the back of the queue as they wait to get their deposits back.
At the time of the bankruptcy, Celsius was grappling with a $1.2 billion black hole in its finances — and an estimated 300,000 customers have a balance of more than $100.
On Thursday, a hearing is taking place as Celsius Network is seeking to open withdrawals for certain customers — but the plans have attracted staunch resistance from the U.S. Department of Justice.
The company wants to return $225 million to about 63,000 users, and argues that assets held in its "custody program and withhold accounts" are not its property.
But U.S. trustee William Harrington has argued that Celsius Network's motion to return these funds is premature — as it's still unclear how much crypto this company holds, and how it relates to deposits made by customers.
Harrington went on to warn that allowing these withdrawals now "could inadvertently impact or limit distributions to other creditors in this case."
