Celsius Might be able to Refund Customers Soon: WSJ
- Bankrupt crypto lending platform Celsius might soon be approved by the court to refund its customers.
- The firm halted withdrawals in June last year, and customers have been unable to access their funds.
- Celsius Network will seek court approval for settlements at an August 10 hearing, as per court documents.
- In October, the confirmation hearing on Celsius’ reorganization plan will commence, the WSJ said.
Bankrupt crypto lending platform Celsius Network might soon be able to refund its customers’ funds, according to a new turn of events. The former multi-billion dollar company has reached settlements that would result in the bankruptcy court allowing the firm to return customer assets. Interestingly, the platform halted withdrawals in June last year, and since then, customers have been unable to access their deposits.
According to a report from the Wall Street Journal (WSJ), which cited court documents as its source, Celsius Network will seek court approval for settlements at an August 10 hearing. Additionally, in October, the confirmation hearing on Celsius’ reorganization plan will commence, and it is crucial to note that customers could start to see disbursements of crypto and other assets before the end of the year.
Additionally, Celsius claims that its customers are not owed a penny more than what they deposited. On the other hand, many customers have sued the firm for mismanagement of their funds under the previous executives of the company.
Another important fact to mention here is that the United States Securities and Exchange Commission (SEC) sued Celsius Network and former CEO Alex Mashinsky in federal court earlier this month. The regulator claims that the company and its former executive raised billions of dollars via fraudulent and unregistered sales.
The agency also claims that the executives and the firm lied to the investors and manipulated the price of the native cryptocurrency of the platform, the CEL token. Interestingly, similar accusations were mentioned in a lawsuit filed by customers of the company. At one point, Celsius Network held more than $30 billion in customers’ assets.
As reported earlier by Bitnation, the Federal Bureau of Investigation (FBI) and the US Attorney for the Southern District of New York have charged the former CEO of the bankrupt cryptocurrency lender Celsius, Alex Mashinsky, with fraud.
Moreover, the US Justice Department announced in a statement on July 13 that it had charged Mashinsky with wire fraud, commodities fraud, and securities fraud, following reports that he had defrauded clients and misled them concerning Celsius’ “success, profitability, and the nature of the investments” the crypto lender made with user funds.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
