Celsius Enlists Advisers for Potential Bankruptcy, According to WSJ Report

Per the lending platform’s terms of use, clients are not guaranteed the return of their funds if Celsius declares bankruptcy

article-image

Source: Shutterstock

share

key takeaways

  • Celsius has hired restructuring consultants from advisory firm Alvarez & Marsal, according to the WSJ
  • The last public communication from the Celsius team came via blog post on June 19, one week after it announced the halt

Celsius has hired restructuring consultants in preparation for a potential bankruptcy filing, the Wall Street Journal reported Friday, citing people familiar with the matter. 

The crypto lending firm — which earlier this month halted withdrawals, swaps and transfers — has reportedly hired three consultants from advisory firm Alvarez & Marsal. 

If the lending firm declares bankruptcy, there is no guarantee customers will be able to recover any funds held on the platform. 

“In the event that Celsius becomes bankrupt, enters liquidation or is otherwise unable to repay its obligations, you may not be able to recover or regain ownership of such Digital Assets,” Celsius’s terms of use state.

The last public communication from the Celsius team came via blog post on June 19, one week after the halt. 

“As has been a priority since our company’s inception, we maintain an open dialogue with regulators and officials,” the post read. “We plan to continue working with regulators and officials regarding this pause and our company’s determination to find a resolution.” 

The post did not address the potential for bankruptcy or the status of consumer funds. 

The lender initially halted withdrawals, swaps and transfers in an attempt to “stabilize our liquidity and operations,” amid volatile market conditions, the company said. Celsius has also paused its weekly question and answer sessions with the community until further notice. 

Celsius did not immediately respond to a request for comment.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Screenshot 2024-05-23 091855.png

Research

Bitcoin L2s aim to boost scalability while preserving decentralization and security, unlocking a better user experience, and new avenues for Bitcoin-powered innovations. However, no existing Bitcoin L2 leverages the full security of Bitcoin.

article-image

Also, a Solana memecoin creator was recently hospitalized with third-degree burns after pulling a stunt intended to pump his token

article-image

Sponsored

Chain abstraction will drive significant innovations, shaping the future of dapps while addressing many current challenges facing the Web3 ecosystem

article-image

Right now, crypto platforms and custody services live in the shadow of a legacy of security failures — and it shouldn’t be that way

article-image

The current crop of ETF issuers could’ve only made it this far by promising not to stake any ETH they hoover up

article-image

After accelerating conversations with issuers, the SEC took a step toward allowing ETH funds to launch

article-image

As FIT21 advances to the Senate, experts are cautiously optimistic but say to expect some changes to the bill