<![CDATA[<figure class="image"><img src="https://cimg.co/news/123481/326561/adobestock-timon-1-media-.jpeg" srcset="https://cimg.co/news/123481/326561/responsive-images/adobestock-timon-1-media-___media_library_original_1350_760.jpeg 1350w, https://cimg.co/news/123481/326561/responsive-images/adobestock-timon-1-media-___media_library_original_1200_676.jpeg 1200w, https://cimg.co/news/123481/326561/responsive-images/adobestock-timon-1-media-___media_library_original_900_507.jpeg 900w, https://cimg.co/news/123481/326561/responsive-images/adobestock-timon-1-media-___media_library_original_720_405.jpeg 720w, https://cimg.co/news/123481/326561/responsive-images/adobestock-timon-1-media-___media_library_original_600_338.jpeg 600w, https://cimg.co/news/123481/326561/responsive-images/adobestock-timon-1-media-___media_library_original_300_169.jpeg 300w" width="1350" class="content-img" alt=""><figcaption>Source: AdobeStock / Timon</figcaption></figure>A bankruptcy judge has refused to determine whether CEL, the native token of&nbsp;<a href="https://cryptonews.com/tags/celsius-network/">Celsius</a>, should be classified as a security, citing the ongoing legal battle between&nbsp;Ripple Labs&nbsp;and the US&nbsp;Securities and Exchange Commission (SEC).&nbsp;Otis Davis, one major CEL token order, had previously asked the judge to "recognize the legal precedent that has been set in the Ripple/XRP case" in order to establish a separate committee for CEL token holders.&nbsp;However, Chief US Bankruptcy Judge Martin Glenn&nbsp;<a href="https://cases.stretto.com/public/x191/11749/PLEADINGS/1174908252380000000045.pdf">denied Davis' motion</a>, among others, on Friday.&nbsp;He clarified in his order that the court's decision did not constitute a definitive conclusion on whether crypto tokens or transactions involving them should be considered securities under federal securities laws.&nbsp;The order explicitly reserved the right for both the SEC and the committee to challenge any transactions involving crypto tokens.&ldquo;Nothing in the Motions, this Order, or announced at the Hearing constitutes a finding under the federal securities laws as to whether crypto tokens or transactions involving crypto tokens are securities," the judge said.&nbsp;The legal dispute between the SEC and Ripple began in 2020 when the agency accused Ripple of illegally raising $1.3 billion through the sale of XRP, claiming it to be an unregistered security.&nbsp;Last month, a US court&nbsp;<a href="https://cryptonews.com/news/xrp-price-prediction-as-judge-rules-favor-of-ripple-deny-sec-motion-seal-hinman-documents-xrp-1.htm">ruled in favor of Ripple</a>&nbsp;in the ongoing lawsuit brought by the SEC, claiming that selling XRP on exchanges in itself does not constitute an investment contract.&nbsp;The ruling, issued by&nbsp;Judge Analisa Torres&nbsp;of the US District Court for the Southern District of New York, stated that the &ldquo;offer and sale of XRP on digital asset exchanges did not amount to offers and sales of investment contracts.&rdquo;However, she also determined that other direct sales of XRP to institutional investors qualified as securities, granting a partial victory to the SEC.&nbsp;This ruling has since been referenced in other court cases, including a separate matter involving Terraform Labs.<h2 id="examiner-claims-celsius-inflated-cel-token-price-to-benefit-executives">Examiner Claims Celsius Inflated CEL Token Price to Benefit Executives</h2>Shoba Pillay, a court-appointed examiner who investigated Celsius&rsquo; handling of CEL tokens and marketing strategy,&nbsp;<a href="https://cryptonews.com/news/bankrupt-crypto-lender-celsius-finds-buyer-for-platform-restart-operations-heres-latest.htm">said</a>&nbsp;earlier this year that the company&rsquo;s business model &ldquo;differed significantly&rdquo; from what it told customers.&nbsp;She even claimed that Celsius &ldquo;on a stand-alone basis has been insolvent since inception" and that the crypto lender used CEL as the centerpiece of a scheme to enrich executives at customers&rsquo; cost.&nbsp;According to the investigation, Celsius spent at least $558 million to purchase CEL tokens on open markets, which led to the token price soaring more than 14,000% since the start of mid-2020.&nbsp;The inflated price favored top company executives, including CEO Alex Mashinsky and co-founder Daniel Leon, who sold CEL worth at least $68.7 million and $9.74 million between 2018 and 2022, respectively.&nbsp;<blockquote>&ldquo;Celsius often sought to protect CEL from price drops that it attributed to Mr. Mashinsky&rsquo;s sales of large amounts of his personal CEL holdings. As a result of Mr. Mashinsky&rsquo;s sales, Celsius often increased the size of its resting orders to buy all of the CEL that Mr. Mashinsky and his other companies were selling.&rdquo;</blockquote>
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Judge Cites Ripple Case in Rejecting CEL's Security Classification in Bankruptcy Proceedings

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