The cryptocurrency crash claimed another casualty: Celsius Network declared bankruptcy under Chapter 11. The future of the cryptocurrency lending company is uncertain as it abruptly stopped all withdrawals and transfers exactly one month ago. It now hopes to continue operating with its remaining $ 167 million in cash as the bankruptcy courts restructure the business.
According to Celsius Networks, the company has assets ranging from $ 1 billion to $ 10 billion, but owes a similar amount. The first five claims range from $ 20 million to $ 80 million each. The company was valued at $ 3.25 billion last year, according to Fortune, and had up to $ 24 billion in assets under management prior to this year’s sale. That amount would have been reduced to about $ 12 billion before withdrawals were suspended, but the bankruptcy filing suggests it now has less.
There were … questions to say the least about Celsius’ business model and operations. We describe some of them here.
Celsius now says it stopped withdrawals last month to avoid a bank run – without a break, the acceleration of withdrawals would have allowed some customers who acted first to get paid in full while others had to wait for Celsius to collect. value from illiquid or longer. asset staging activity dated before receiving a rebound, the company’s press release read today.
Cryptocurrency hedge fund Three Arrows also filed for bankruptcy earlier this month.