Cryptocurrency platform Celsius files for bankruptcy

The Celsius Network cryptocurrency platform, which received an investment of nearly $200 million from the Caisse de depot et placement du Québec (CDPQ), had to file for bankruptcy, nearly a month after freezing the assets of its 2 million members.

• Read also: A Caisse partner accused of having built a Ponzi scheme

Celsius said in a statement Wednesday that it had filed for Chapter 11 of the United States Bankruptcy Code in the court for the Southern District of New York.

This decision was made in order to “stabilize its business and achieve a comprehensive restructuring operation that maximizes value for all stakeholders”.

The London cryptobank is not experiencing its first problems, since it had to freeze the assets of more than $12 billion of its members on June 12, by suspending all withdrawals, exchanges and transfers.

“Without a pause, accelerated withdrawals would have allowed some customers—those who were the first to act—to be paid in full while leaving others behind to wait for Celsius to reap the value of deployment activities. illiquid or longer-lived assets before receiving a recovery,” said the members of the special committee of the board of directors.

The company said it has cash on hand of US$167 million, which “will provide sufficient liquidity to support certain operations during the restructuring process”.

Celsius promised returns of more than 18% to customers who were willing to lend their cryptocurrency, according to Bloomberg. These coins were then entrusted to institutional investors, but Celsius was also involved in decentralized finance applications.

During the last month, the platform had also repaid all of its debt of more than $900 million USD in the Aave, Compound and MakerDAO applications, added the media.

Recall that “Le Journal” had learned last October that Celsius was monitored by the Financial Markets Authority.

Celsius is also not the only cryptocurrency platform struggling in today’s market. Another lender, Babel, also halted withdrawals, stock exchange Voyager Digital took shelter from creditors and hedge fund Three Arrows Capital went into insolvency.


source site-64

Latest