Celsius Goes through Hard Times as Creditors Claim It Has Lost Equity
An exclusive group of creditors has arisen in the bankruptcy episode of Celsius. Investors or shareholders with equity in the platform have submitted a motion in the continuous bankruptcy proceedings of Celsius.
Celsius’ Shareholders File a Motion Amid the Current Bankruptcy Proceedings
A motion has been filed by Milbank LLP on the behalf of the shareholders of Celsius amid the present bankruptcy proceedings of the company. The respective motion required a formally prioritized equity committee’s appointment to stand on the behalf of the shareholders who invested in Celsius’ Series A and B funding. Plus, Caisse de dépôt et placement du Québec (CDPQ) and WestCap (an equity company) led Celsius’ funding round of Series B in October previous year.
Furthermore, the respective round was accomplished following the collection of $400M after which the valuation thereof reached approximately $3B. Along with this, in November of the previous year, it was disclosed by Celsius that the round witnessed an oversubscription. As a result, an enormous amount of nearly $750M has been raised cumulatively in Series-B funding. Furthermore, it would be inaccurate to say that the shareholders are gathering to get their share. Rather, they are demanding a greater priority instead of the original account holders.
Lending Platform Experiences a Heated-up Scenario
Shareholders intend to be the earliest to profit from particular assets’ sales. A sum of $5B out of nearly five hundred thousand creditors. The bankrupt platform’s executives are at the moment pursuing to transform the debt thereof into a crypto coin. Secondly, Tiffany Fong, a well-known victim of Celsius, shared an internal conference’s audio. Furthermore, Guillermo Bodnar, the CTO of the company, outlines the strategy of the platform to release IOU crypto tokens.
In addition to that, Nuke Goldstein – the co-founder of Celsius – elaborated the role of an IOU is to be played on the behalf of the wrapped tokens for the consumers who participated in the Earn accounts of Celsius. According to the reports, the respective tokens will denote the ratio between the amount owed by the lending platform to the consumers and the assets available to them.
The very strategy was in its early phases as of 24th September. In the previous month, some other claimants came to the front. They were the U.S. states-based holders of Celsius Withhold Accounts as the firm had restricted them from providing custody accounts.
