Celsius to End Bankruptcy Auction; Fahrenheit Leading The Bid

The attorney representing Celsius Network said on May 17, 2023, the crypto lender auction would soon be completed. The current top bidder is Fahrenheit LLC, a consortium that includes blockchain-based venture capital firm Arrington Capital. The auction details were discussed in a U.S. Bankruptcy Court hearing in Manhattan.

Ross Kwasteniet, while representing the crypto lender in U.S. Bankruptcy Court, told Judge Martin Glenn that the auction process had been lengthier than expected and highly competitive. He added that the ongoing bids are “worth hundreds of millions of dollars,” which is much bigger than the amount proposed by NovaWulf LLC during the initial bidding.

The globally popular crypto lender filed for Chapter 11 bankruptcy in mid-July 2022. Celsius was among dozens of crypto lenders that filed for bankruptcy following the disastrous Covid-19 pandemic.

Although it is important to note that most market analysts blame LUNA’s collapse as the main reason for Celsius’s bankruptcy, others believe that constant crypto market growth during the global pandemic is responsible for such bankruptcies.

Lead Bidders in Celsius Auction

Before getting into trouble, crypto lenders informed that it has more than 1.5 million registered users, with 300K active users holding more than $100 as their crypto balance on the platform.

On April 22, 2023, Celsius announced that it is seeking some buyers and investors who can lead the companies’ crypto lending and bitcoin mining businesses out of bankruptcy. Initially, the crypto lender was planning to accept the offer made by NovaWulf.

According to the Lawyer, Celsius is still reviewing both offers, and the process is expected to be concluded by the end of the week. Both the lead participants assured the crypto lender that its business might work as they were working earlier.

The third and most crucial bidder in the Celsius auction is the Blockchain Recovery Investment Committee which is directly associated with Gemini Trust, co-founded by the Winklevoss brothers. Moreover, BRIC only offers to handle the mining business of the crypto lender. BRIC will play an essential role in the auction process if any lead bidders fail to get regulatory approval for the acquisition.

Is Celsius and the FTX Collapse Related?

According to FTX and Celsius court filing, more than 3.5 million SRM tokens of crypto lenders are locked on the FTX platform. It is also known that Celsius lent 13 million to the trading company of Sam Bankman Fried Alameda Research.

Over 100 crypto-focused and traditional companies faced trouble after the unprecedented failure of the world’s third biggest and largest crypto exchange co-founder, Bankman Fried.

When writing this article, the crypto market leader, Bitcoin, was trading at $27,223.55 with a 24-hour trading volume of $10,532,000,900. As per data from CoinMarketCap, there are currently 24,251 cryptocurrencies, including stablecoins.

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational ideas only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.