Users owed £4 billion by bust crypto lender Celsius

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The staggering $4.7 billion (£4 billion) of assets is owed to users of bankrupt crypto lender Celsius Network, court filings show, as crypto holders struggle to recover their investments in the wake of the Bitcoin price crash.

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In a filing with the Southern District of New York, Celsius revealed it had a $1.2 billion hole in its balance sheet. The firm blamed its demise on rampant inflation, war and Ukraine and the collapse of several other crypto funds, which led to “growing industry-wide reluctance to do business with companies, such as Celsius, that held crypto assets.”

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Boss Alex Mashinsky said in the filing: “As a result of all these factors, users began withdrawing crypto from Celsius’ platform in large amounts and at a rapid pace.

“Due to the drop in value of digital assets, Celsius was unable to both meet user withdrawals and provide additional collateral to support its obligations.”

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The company said some of its crypto assets had been sold or pledged against loans to buy Bitcoin mining equipment and digital asset storage facilities.

In June, Celsius suspended withdrawals, swaps and transfers on its platform citing “extreme market conditions.”

The company said it hoped the bankruptcy filing would “generate meaningful recoveries to our stakeholders as quickly as possible.”

Over $1 trillion has been wiped off the value of global crypto assets in the past three months according to CoinMarketCap.

Celsius had 1.7 million registered users with $6 billion in assets.

Celsius is the third major crypto firm to enter bankruptcy in three weeks following the collapse of broker Voyager Digital last week and hedge fund Three Arrows Capital in June.

The filing also revealed Celsius was owed $40 billion by Three Arrows Capital. Three Arrows’ liquidators have accused the company’s founders of refusing to cooperate with them.

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Credit: www.standard.co.uk /

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