A new Wall Street Journal report reveals that the puzzled crypto lending platform Celsius Network may be preparing to file for bankruptcy after hiring a restructuring consultant from its advisory firm Alvarez & Marsal. Did.
Earlier this month, the Celsius Network suddenly stopped withdrawing, exchanging, and transferring users due to the current market crash due to its decision.
Since then, the platform has provided little or no information to users about when the service will resume. However, its CEO Alex Mashinsky issued a vague statement on June 15 that his team “worked non-stop.”
According to the information available, Celsius is currently seeking new funding from investors. However, with a new revelation, the lending platform is also considering the possibility of filing for bankruptcy.
According to its usage conditions
If Celsius goes bankrupt, liquidates, or otherwise fails to repay its obligations, eligible digital assets used as collateral for Earn Service or Borrow Service may not be recoverable and related legal remedies. Or you may not have the right.With Celsius
Mr. Celsius previously hired a restructuring lawyer from Akingamp Strausshower & Phelp LLP.
At its peak, Celsius had more than 1.5 million users, providing up to 18% revenue on customer deposits. The company also claimed that it had approximately $ 12 billion in assets under management as of May 2022.
Like others, like Celsius
Celsius is not the only cryptocurrency lender facing liquidity issues. Other companies like Voyager, BlockFi and Three Arrow Capitals are facing liquidity challenges as the current crypto market crash has led to bailout talks.
SEC Commissioner Hester Peirce said in a recent interview that she does not support the crypto company’s bailout. This view is also shared by Binance CEO Changpeng Zhao, who said that bailouts for bad projects are meaningless.
However, the companies led by Sam Bankman Fried were forced by some of these companies to expand their credit lines.