- Celsius Network Crypto Lender filed its bankruptcy in July 2022.
Celsius Network is a crypto lender that filed for Bankruptcy under chapter 11 of Bankruptcy rules in July 2022. The company halted its withdrawal services and stated that “extreme market conditions” are responsible for taking this step.
During Bankruptcy in Southern District New York, Celsius Network’s bankruptcy filings need a total liability of $5.5 billion and $4.3 billion in assets. This shows a distinction of $1.2 billion, the corporate’s claimed deficit.
If Celsius sells all their assets, including its mysterious half-assed mining, a huge loophole of nearly $1.2billion will be left on the company’s balance sheet.
Bankrupt Crypto lender firm Celsius Network is planning to convert its debt into crypto “IOU” (“I Owe You”) tokens.
Although a popular Youtuber and a valuable customer of Celsius Network, Tiffany Fong shared a leaked audio recording of Celsius Network’s official meeting, which indicates that the firm is planning to opt for a crypto-based payment method banding the bitcoin, ether, and USDC it owes customers into a digital token. Moreover, Celsius’s Chief Technical Officer and co-founder explained that it “represents the ratio between how much we really owe and how much we have.”
After the debt clearance, the Customers can redeem the wrapped “IOU token” or trade using them in an open market, or hold them and wait for the long-term recovery of Celsius Network.
Tiffany Fong shared another leaked audio of Celsius Network in which the Chief Executive Officer of Celsius is found saying that they issued the IOU tokens with the unsecured creditor’s committee, which reacted with “positive feedback.”
The leaser board of trustees, which addresses the interests of clients and loan bosses in the liquidation cycle, affirmed that Mashinsky had met with them and introduced a proposition.
Oren Blonstein, Chief Compliance Officer(CCO) of Celsius Network, underlined that “This is really how we resolve this, how we get out,” adding more he said, ” What we do in this pivotal moment can be through unprecedented really innovative solutions and this is one of them.”
Source: https://www.thecoinrepublic.com/2022/09/23/celsius-network-may-be-planning-to-convert-its-loans-to-crypto-iou-tokens/