U.S Court Set Deadline For Celsius Users and Customers To File Proofs of Claims   

• Celsius was among the top five crypto lenders globally that filed for bankruptcy in July. 
• The next hearing of the Celsius case will be in the first week of December 2023. 

Celsius Network filed its bankruptcy on July 13, 2022, and the firm filed bankruptcy under chapter 11 of bankruptcy proceedings in the southern district of New York.

In Chapter 11 bankruptcy, the companies can restructure their financial accountability through different tactics—including reorganisation, sales or activities. 

According to the official document, a deadline has been set for filing any claims against the former crypto lender. Any person or entity, including individuals, partnerships, corporations, joint ventures and trusts, who wish to do so must submit a proof of claim by January 3, 2023, at 5:00 p.m. EST.

Celsius authorities also informed its users and investors via Twitter posts and provided a video link to help explain the claim process. 

The decision came soon after the autonomous examiner in the Celsius case alleged that the company had “insufficient” accounting and operational controls in its management of client funds.

Regulators are constantly monitoring the crypto lender’s activities. According to a court ruling on November 1, an investigation has been ordered to investigate Celsius’ potential as a Ponzi scheme, as users and investors claim. The former crypto lender used the new users’ assets, covering current yields and providing withdrawal facilities.

In addition to the above decision, the court objected to reopening the platform for withdrawals and the sale of stablecoins; The court will hold the next hearing on the Celsius case on December 5, 2022.

Earlier on September 28, 2022, TheCoinRepublic reported that Alex Mashinsky, who started the cryptocurrency lending firm Celsius Network in 2017 yesterday quit the firm. He said that his work became an ‘increasing distraction.’

After the resignation of the CEO on October 5, 2022, Daniel Leon, the co-founder of Celsius Network, resigned from his post.   

Bloomberg confirmed the resignation of Daniel after the official statement of Celsius Network “We confirm that Daniel Leon resigned from his position at Celsius and is no longer part of the organization.”  

The Trustee in charge of the Celsius chapter 11 bankruptcy case, William Harrington, has opposed the retention bonus worth $2.96 million, saying there is a lack of sufficient information and evidence. 

 In his Supporting statement, submitted on October 27, the Trustee slammed Celcius stating that “It defies logic, not to mention the Bankruptcy code, that a corporation where the bulk of its activities are no longer delivering services, would suddenly propose a multi-million dollar bonus scheme.” 

The crypto market has been struggling hard since the beginning of 2022, and the crypto winter has changed the geography of the crypto industry over the past six months; More than 10 cryptocurrency and crypto lenders have failed and filed for bankruptcy.

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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