imrs 5 Celsius crypto lender files for bankruptcy, leaving depositors' hopes diminished

Celsius crypto lender files for bankruptcy, leaving depositors’ hopes diminished

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*Embattled crypto lender Celsius Network on Wednesday night said it had filed for bankruptcy, dealing a further blow to depositors who had spent the past month wondering if they would ever see their money again.
*Joe Rotunda, the enforcement director at the Texas State Securities Board, which has been among the state regulators investigating Celsius, had said earlier Wednesday that bankruptcy filings appear imminent.
*The company confirmed the news, saying that it had filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.
*Celsius said it would continue to operate, noting it has $167 million in cash on hand, which will provide ample liquidity to support certain operations during the restructuring process but said that it was not requesting authority to allow customer withdrawals at this time. Customer claims will be addressed through the Chapter 11 process, it added.
The move jettisons hopes that a large number of depositors will be made whole most retail investors are considered unsecured creditors in a bankruptcy and thus at low priority to be repaid.
*Celsius is believed to have more than 500,000 depositors. Among its unsecured creditors, it said in its petition, were an investment firm based in the Cayman Islands, to which it owes nearly $300 million, a digital marketing firm owed more than $13 million, and a digital trading firm to which it owes $12.7 million.
*An email sent to the companys press account requesting comment was not returned Wednesday night, but a separate request to the companys public relations agency, C Street Advisory Group, brought a no comment response.
*For several years, Celsius was a crypto golden child under co-founder Alex Mashinsky, offering more than 20 percent yields under what he and other executives said was a disruptive plan that avoided the fees and greed of traditional banks.
*The company elicited some skepticism, with doubters asking how it was able to manage such high returns without taking untenable risks. But it also generated many fans, and depositors poured in.
*The company froze deposits on June 12, saying, Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals.
*The market conditions alluded to falling cryptocurrency values as well as the crash of Terra, a company with a stablecoin and token that had swiftly lost nearly all its value over just a several-day span in May.
*But Celsius also said that it was taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations.
*A week later, the company posted updates on its site intimating that an unfree

OV4MYEHNQYI6ZH4QPHPR7MUCSY Celsius crypto lender files for bankruptcy, leaving depositors' hopes diminished
Celsius crypto lender files for bankruptcy, leaving depositors' hopes diminished 3

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