Celsius offers withdrawals to qualified crypto holders
Defunct cryptocurrency lending platform Celsius has begun issuing loans to select users in a significant development for the company and its customers amid financial uncertainty and legal issues.
According to the lawsuit filed in the United States Bankruptcy Court for the Southern District of New York, participants in the captive program who fall under the “Section 6A General Security Claims” and “Section 6B Subsidiary Security Claims” are now eligible to withdraw funds, which is a deadline. Withdrawal for February 28, 2024.
Eligible participants can withdraw up to 72.5% of their cryptocurrency holdings, minus transaction fees. Customers who objected to the reorganization plan were excluded. Instead, a litigation manager handles their assets independently for six months.
Following its bankruptcy filing in July 2022, the platform navigated various legal hurdles. In March, a settlement plan was approved by 2023 requiring all deposit account holders to deposit 72.5% of their funds in two installments.
Related: Zipmex proposes to pay lenders 3 cents on the dollar
In a further update, creditors approved the company's reorganization plan in September, paving the way for a distribution of about $2 billion in Bitcoin (BTC) and Ether (ETH). The company's equity will be transferred to Newco, controlled by the Fahrenheit Consortium. In the year In a Nov. 20 announcement, Celsius said NewCo's proposed restructuring plan would be Bitcoin mining instead of mining.
Celsius has been operating through bankruptcy proceedings and legal challenges from several regulatory bodies. The US Securities and Exchange Commission, the Federal Trade Commission (FTC) and the Commodity Futures Trading Commission have all filed charges against the company and its CEO, Alex Mashinsky, primarily on charges of defrauding consumers. Although Celsius reached a $4.7 billion settlement with the FTC, Mashinsky faces criminal charges.
Magazine: Crypto's ‘pro-violer' glitch artist sparks controversy – Patrick Amadon, NFT creator
