Digital Assets: Celsius Goes Under Too, Files For Bankruptcy

July 14, 2022 | Digital Assets, News
https://dailyalts.com/wp-content/uploads/2022/07/wallet-3548021_640.jpg

Alex Mashinsky-led Celsius Network recently laid off 150 employees.

Troubled crypto lender Celsius Network has finally entered a voluntary bankruptcy process and filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. The step would “provide the Company with the opportunity to stabilize its business and consummate a comprehensive restructuring transaction that maximizes value for all stakeholders,” Celsius said in a statement.

During the bankruptcy process Celsius will continue to operate using cash on hand as on date of $167 million.

Celsius’ insolvency follows other similar high profile crypto fold-ups such as Three Arrows Capital and Voyager Digital (TSE: VOYG) amidst a brutal crypto bear market. Another factor that has apparently triggered a domino effect in the industry may have been the Terra/Luna disaster which caused losses in the billions of dollars for investors.

Celsius had in June paused withdrawals, swaps, and transfers on its platform, citing “extreme market conditions.” That led to speculation about its long term solvency.

“Today’s filing follows the difficult but necessary decision by Celsius last month to pause withdrawals, swaps, and transfers on its platform to stabilize its business and protect its customers,” Celsius said. “Without a pause, the acceleration of withdrawals would have allowed certain customers—those who were first to act—to be paid in full while leaving others behind to wait for Celsius to harvest value from illiquid or longer-term asset deployment activities before they receive a recovery.”

Earlier this month, Celsius laid off about 150 employees as it sought to extricate itself from its financial problems.

Related Story: State Regulators Take Aim At Crypto Companies Including Celsius

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Shape

Latest Alternative Investment News

https://dailyalts.com/wp-content/uploads/2023/02/the-eleventh-hour-gfac76b1a4_640.png
Alternative Investments/ESG: Six New Responsible Funds Flag Off Morgan Stanley’s ETF Platform

Morgan Stanley Investment Management (MSIM) has launched its ETF platform with six Calvert ETFs listed on NYSE Arca. The ETFs feature Calvert’s responsible investing approach and offer access to four…

https://dailyalts.com/wp-content/uploads/2023/02/adi-goldstein-i3gs_IIyvuI-unsplash.jpg
Artificial Intelligence: MusicLM, A New Generative AI Tool From Google, Creates Music From Text
February 2, 2023     Artificial Intelligence, News

Google (NASDAQ: GOOGL) recently published a research paper on its new AI tool, MusicLM, designed to create music. The tool is based on machine learning and is trained on vast…

https://dailyalts.com/wp-content/uploads/2023/02/augmented-reality-g86922a9f7_640.jpg
Artificial Intelligence: Snap Mulling AR Glasses Powered By Generative AI
February 2, 2023     Artificial Intelligence, News

Snap (NYSE: SNAP), the parent company of Snapchat, has hinted at future AR glasses powered by generative AI technology. CEO Evan Spiegel stated that AI will be critical to the…

https://dailyalts.com/wp-content/uploads/2023/02/94280bca-3fa2-430a-a5cd-2b2b997f622b.png
Digital Assets: Binance And Mastercard Launch Prepaid Crypto Card In Brazil
February 1, 2023     Digital Assets, News

Binance and Mastercard (NYSE: MA) have jointly launched the Binance Card in Brazil, allowing Binance users in the country to make purchases and pay bills with cryptocurrencies like bitcoin and…