Crypto lender Celsius to withdraw $470M in Ethereum assets before payment
Embattled crypto lending platform Celsius has confirmed that it has begun recalling and rebalancing its crypto assets, including Ether (ETH), as it prepares for “timely distribution to lenders”.
On Jan. 5, the lender, which has been in bankruptcy court since filing for Chapter 11 in July 2022, said it has begun shifting assets to “ensure more liquidity” in preparation for any distribution of assets.
Celsius added that its existing Ether holdings “provided significant reward income for the estate.”
The freed Ethereum will be used “to offset certain costs in the restructuring process” and “to unlock ETH to ensure timely distribution to creditors.”
In preparation for any asset distribution, Celsius has initiated a process of pooling and balancing assets to ensure adequate liquidity.
— Celsius (@CelsiusNetwork) January 4, 2024
The move is positive news for customers who have to wait at least 18 months to get their money back. In its recovery plan, Celsius said it will distribute BTC and/or ETH to creditors.
Blockchain analytics firm Nansen reports that Celsius currently has about a third of ETH in the pending withdrawal queue.
That's a whopping 206,300 ETH, worth approximately $468.5 million at current prices. Additionally, 19,906 validators were waiting for a full withdrawal and Celsius reported that 40,249 ETH had been withdrawn so far.
While some fear that the move will “dump” Ethereum on the markets, others suggest that this is a positive move for the Ethereum markets in the long run.
I don't think the celsius vampires realize how much weight will be lifted from ETH when they finally forget about it and repurpose what's left.
Related: Celsius offers withdrawals to eligible crypto holders
Celsius It was one of the many crypto lenders that went bankrupt during the crypto contagions of 2022.
In November, the company announced a balanced post-bankruptcy strategy focused on Bitcoin mining. However, the judge presiding over the company's bankruptcy proceedings expressed dismay at the sudden change.
Magazine: Are DAOs Overhyped and Dysfunctional? Lessons from the front lines
