Celsius creditors file to subpoena defunct crypto exchange FTX, here’s why

• The Unsecured Creditors Committee of Celsius has filed to subpoena FTX.
• The creditors want information related to certain FTX users who executed suspicious CEL trades last year.

Creditors of the Celsius Network are looking to subpoena the Bahamas based bankrupt crypto exchange FTX in order to extract information on certain users associated with a series of suspicious crypto trades last year.

The defunct crypto lender’s creditors believe that these users may have manipulated the price of Celsius’ native token CEL.

Celsius creditors to summon FTX

According to a 26 April filing with a U.S. Bankruptcy Court, the Celsius creditors were seeking a court approval to issue a subpoena to the FTX debtors.

During the latest bankruptcy hearing, the creditors committee revealed that it tapped Elementus Inc, a blockchain consultancy firm, which identified more than 900 transactions “involving a near one-to-one relationship” between CEL deposits and withdrawals among ten crypto wallets on FTX. 

The creditors want to identify the users behind the ten wallets who executed suspicious CEL trades between April and August in 2022.

The committee stated that it was important to get clarity on the trades since they were executed between the date of the withdrawal pause enforced by Celsius and the date of the Chapter 11 bankruptcy filing. 

The filing read,

“The Subpoenas request information on the identities and user accounts of the entities or individuals associated with the Identified FTX Wallets, any other FTX user accounts that those individuals or entities had, the complete transaction history of all the user accounts identified for those individuals or entities, the identities and user accounts of the entities or individuals associated with all short positions with respect to CEL Tokens on the FTX Exchange from April 1, 2022 to August 30, 2022.”  

The suspicious nature of these trades has led to a dispute over the CEL price offered in the bankruptcy plan by the Celsius estate. The company offered 20 cents but the creditors’ committee cited the FTX trades to highlight potential manipulation in the price of the CEL token.