Celsius

Wednesday

Green Light

Celsius Network, a cryptocurrency lending company that faced financial distress, is poised to emerge from bankruptcy following a Delaware bankruptcy court’s endorsement of its customer repayment proposal on Thursday.The plan, introduced to the court on October 2, outlines the creation of a fresh entity named NewCo, backed by $450 million in initial funding.NewCo, dedicated to Bitcoin mining and staking, will be owned by the previously disillusioned customers and creditors of Celsius.Under the leadership of former CEO and co-founder Alex Mashinsky, Celsius experienced a collapse in the summer of the previous year amid a broader downturn in cryptocurrency prices. As of October 2021, the company, which had $25 billion in assets under management, will now be overseen by the Fahrenheit Group, the consortium that successfully acquired Celsius in May.NewCo aims to go public on the Nasdaq to enhance liquidity for creditors, as outlined in a filing.The approved plan also outlines the distribution of “at least $2.03 billion” in cryptocurrency to creditors. Celsius lawyers suggest that customers, who lost control of their accounts and cryptocurrencies for over a year, may witness repayments in early 2024.It is worth noting that in July, Mashinsky faced criminal charges and civil lawsuits for his actions as the head of Celsius. Various regulatory bodies, including the Department of Justice, Securities and Exchange Commission (SEC), Commodities Futures Trading Commission, and Federal Trade Commission, took legal actions against him.Mashinsky, along with Roni Cohen-Pavon, the company’s chief revenue officer, and other employees, was accused of fraud, involving a scheme to artificially inflate the price of Celsius’s proprietary token, CEL. Before the plan’s approval, CEL experienced a surge to $0.25 on Wednesday but subsequently fell to $0.23, reflecting a 7% decline over the past day, according to CoinGecko.U.S. Bankruptcy Judge Martin Glenn sanctioned the plan without definitively determining whether the digital assets of Celsius’ creditors are considered securities or commodities, according to Decrypt. However, he indicated that the SEC might contest certain transactions, stating that the confirmation order does not constitute a finding on whether crypto tokens or related transactions are deemed securities under federal securities laws.The SEC’s right to challenge such transactions on any basis is explicitly preserved.The post <a href="https://www.unlock-bc.com/111825/celsius-emerges-from-bankruptcy-as-repayment-plan-gets-green-light/" rel="noopener noreferrer nofollow">Celsius Emerges from Bankruptcy as Repayment Plan Gets Green Light</a> appeared first on <a href="https://www.unlock-bc.com" rel="noopener noreferrer nofollow">UNLOCK Blockchain</a>.

Celsius Emerges from Bankruptcy as Repayment Plan Gets Green Light

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