DOJ objects to Celsius plans to reopen withdrawals

The objection is seeking a deferral on Celsius motions
Celsius’ financials is lacking transparency – DOJ
Pillay will have two months to prepare and file an examiner’s report

The Department of Justice (DOJ) has objected to Celsius’s plan to sell its stablecoin holdings and reopen withdrawals for select customers.

According to the DOJ, crucial decisions like this should not be made until the independent examiner report has been filed because Celsius’s financial situation is opaque.

The DOJ’s move adds to the objections that the Texas State Securities Board, Texas Department of Banking, and Vermont Department of Financial Regulation submitted last week.

The DOJ has opposed stablecoin sell

All three say that Celsius shouldn’t sell its stablecoin holdings because the company could use the money to continue operating in violation of state laws.

William Harrington, a U.S. Trustee for the Department of Justice, expressed his opposition to Celsius’s decision to allow withdrawals from its custody and withhold customers in a filing made on September 30 with the Bankruptcy Court for the Southern District of New York, citing a lack of financial transparency.

The DOJ has also opposed a possible sale of stablecoins, citing the same concerns held by regulators in Texas and Vermont that Celsius’s motion does not provide a concrete explanation of what impact such a distribution or sale would have on the business moving forward.

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Independent examiner appointed

According to Harrington, the United States Trustee appointed Shoba Pillay as the examiner on September 29, with approval from the New York Bankruptcy Court on the same day.

Pillay will have approximately two months to prepare and submit a Celsius examiner’s report outlining the company’s assets and liabilities.

On October 1, the founder of the cryptocurrency investment platform BnkToTheFuture, Simon Dixon, who was the primary investor in Celsius, made a prediction via Twitter that Celsius would attempt to repay its creditors in Celsius (CEL) tokens as part of a reorganization plan that, in the end, won’t get past regulators & regulators will file motions to reject it. This was part of a plan that ultimately won’t get past regulators & regulators will

Dixon anticipates a competitive bidding war for Celsius assets in the event of such an event, similar to the recent $1.3 billion asset auction held by Voyager Digital, which was won by FTX US.

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