Digital Assets: Celsius Goes Under Too, Files For Bankruptcy

July 14, 2022 | Digital Assets, News

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.


Latest Alternative Investment News
Digital Assets: Ripple Labs Eyeing Pieces Of Celsius In Bankruptcy Wreckage
August 10, 2022     Digital Assets, News

Ripple Labs, the blockchain payments company that created the XRP cryptocurrency, is interested in purchasing assets of Celsius Network, the crypto lender that was forced into bankruptcy amidst the meltdown…
FinTech: German Bank Nuri Files For Insolvency Amidst Macro Environment And Crypto Bear Market
August 10, 2022     Digital Assets, FinTech, News

Nuri, a digital banking platform and app, offered users crypto transactions as well as normal banking activities including a debit card. The firm announced it had filed for insolvency on…
Artificial Intelligence: AI Robot TX SCARA To Debut In 300 FamilyMart Stores In Japan
August 10, 2022     Artificial Intelligence, Latest News, News

Telexistence Inc., the Japanese robotics company, announced the launch of its TX SCARA restocking robots in 300 FamilyMart convenience stores in Japan later this month as part of its AI-based…–-Splash.png
Alternative Investments/Digital: GraniteShares Launches The First Coinbase Leveraged ETF
August 10, 2022     Alternative Investments, News

US ETF issuer GraniteShares, which first launched leveraged ETFs on single stocks in the UK in 2019, and now offers 106 such products across Europe, has listed a suite of…