Celsius Seeks Court Approval on Repaying Customers by Year-End
Digital asset lender Celsius Network plans to start repaying its users by the end of the year and has sought court approval for its restructuring plan. The company, which has filed for Chapter 11 bankruptcy, aims to transform into a user-owned Bitcoin mining venture called NewCo. NewCo is expected to secure $450 million in initial funding and receive financial backing from a consortium led by Investment firm Arrington Capital. Celsius plans to partially repay its creditors using $2.03 billion in bitcoin and stock in the new company. However, the restructuring plan faces opposition from users and an affiliate of Lantern Ventures, which claims $82 million in owed funds and believes the new Bitcoin mining business is overvalued. The court is currently evaluating the plan. If approved, it would be the first instance of a failed digital asset platform being reborn in Chapter 11 proceedings. If the new company fails, users could receive lower repayments through liquidation.
Celsius Network, a troubled digital asset lender that has filed for Chapter 11 bankruptcy, intends to start repaying its users by the end of this year and has sought court approval for its restructuring plan. The company aims to transform into a user-owned Bitcoin mining venture called NewCo, which is expected to secure $450 million in initial funding. NewCo will also receive financial backing from a consortium called Fahrenheit LLC, led by investment firm Arrington Capital. Celsius plans to partially repay its creditors using $2.03 billion in bitcoin and stock in the new company.
During a confirmation hearing in New York, Christopher S. Koenig, representing Celsius as legal counsel, provided details of the restructuring plan. He mentioned that NewCo would receive substantial financial backing from a consortium led by Arrington Capital. This consortium, called Fahrenheit LLC, believes in the business and is investing in it. Celsius plans to distribute at least $2.03 billion in cryptocurrency to creditors and seed NewCo with up to $450 million in cryptocurrency.
The repayment announcement came during the confirmation hearing, where Celsius sought court approval for its restructuring plan. The plan, which has received a majority of votes in favor, is currently being evaluated by Judge Martin Glenn. However, it faces opposition from users whose funds have been locked on the platform and an affiliate of Lantern Ventures, which claims $82 million in owed funds and contests the valuation of the new Bitcoin mining business.
Celsius customers have been eagerly waiting for resolution and repayment since the company suspended withdrawals in June 2022 after the collapse of the Terra ecosystem. Celsius is one of several digital asset platforms that filed for bankruptcy, including Three Arrows Capital, BlockFi Inc., and FTX.
If approved, Celsius’s restructuring plan would be the first instance of a failed digital asset platform being reborn in Chapter 11 proceedings. However, if the new company fails, users could receive lower repayments through liquidation.
The court will decide whether to approve Celsius’s restructuring plan. In the meantime, users and creditors are anxiously awaiting the outcome and hoping for a resolution that will provide fair repayment for their investments..
#Celsius #Seeks #Court #Approval #Customer #Repayments #YearEnd
Digital asset lender Celsius Network plans to start repaying its users by the end of the year and has sought court approval for its restructuring plan. The company, which has filed for Chapter 11 bankruptcy, aims to transform into a user-owned Bitcoin mining venture called NewCo. NewCo is expected to secure $450 million in initial funding and receive financial backing from a consortium led by Investment firm Arrington Capital. Celsius plans to partially repay its creditors using $2.03 billion in bitcoin and stock in the new company. However, the restructuring plan faces opposition from users and an affiliate of Lantern Ventures, which claims $82 million in owed funds and believes the new Bitcoin mining business is overvalued. The court is currently evaluating the plan. If approved, it would be the first instance of a failed digital asset platform being reborn in Chapter 11 proceedings. If the new company fails, users could receive lower repayments through liquidation.
Celsius Network, a troubled digital asset lender that has filed for Chapter 11 bankruptcy, intends to start repaying its users by the end of this year and has sought court approval for its restructuring plan. The company aims to transform into a user-owned Bitcoin mining venture called NewCo, which is expected to secure $450 million in initial funding. NewCo will also receive financial backing from a consortium called Fahrenheit LLC, led by investment firm Arrington Capital. Celsius plans to partially repay its creditors using $2.03 billion in bitcoin and stock in the new company.
During a confirmation hearing in New York, Christopher S. Koenig, representing Celsius as legal counsel, provided details of the restructuring plan. He mentioned that NewCo would receive substantial financial backing from a consortium led by Arrington Capital. This consortium, called Fahrenheit LLC, believes in the business and is investing in it. Celsius plans to distribute at least $2.03 billion in cryptocurrency to creditors and seed NewCo with up to $450 million in cryptocurrency.
The repayment announcement came during the confirmation hearing, where Celsius sought court approval for its restructuring plan. The plan, which has received a majority of votes in favor, is currently being evaluated by Judge Martin Glenn. However, it faces opposition from users whose funds have been locked on the platform and an affiliate of Lantern Ventures, which claims $82 million in owed funds and contests the valuation of the new Bitcoin mining business.
Celsius customers have been eagerly waiting for resolution and repayment since the company suspended withdrawals in June 2022 after the collapse of the Terra ecosystem. Celsius is one of several digital asset platforms that filed for bankruptcy, including Three Arrows Capital, BlockFi Inc., and FTX.
If approved, Celsius’s restructuring plan would be the first instance of a failed digital asset platform being reborn in Chapter 11 proceedings. However, if the new company fails, users could receive lower repayments through liquidation.
The court will decide whether to approve Celsius’s restructuring plan. In the meantime, users and creditors are anxiously awaiting the outcome and hoping for a resolution that will provide fair repayment for their investments..
#Celsius #Seeks #Court #Approval #Customer #Repayments #YearEnd
