State Regulators Endeavor to Hinder the Stablecoin Sale of Celsius
The court filings that Vermont and Texas states have made have turned into exclusive developments within the bankruptcy epic of Celsius. Both the state regulators have submitted separate motions to question the stablecoin sale proposed by the crypto lending company that has now become defunct.
Vermont and Texas State Regulators File Against Celsius’ Request for Stablecoin Sale
In its sale proposal, Celsius had appealed to the U.S. Bankruptcy Court for the Southern District of New York to provide a green signal for the sale of the stablecoins of approximately $23M worth. The respective filing pointed out that the platform would utilize the proceeds taken from that sale to fund the operational expenses of Celsius. The Texas Department of Banking and the Texas State Securities Board has filed a motion that refutes the proposed sale. The reason cited by them is the deficiency in regulatory compliance within the state.
They added that the platform had remained unsuccessful in becoming registered under the State Securities Board. The state of Texas is highly concerned about the request made by the debtors for a directive that permits the obscurely huge authority to exchange and/or trade the assets, as added in the filing. Otherwise, the filing noted that if the court considers permitting Celsius to do the sale, the entirety of the proceeds given by the sale would be utilized to provide an advantage to the bankruptcy estate’s creditors.
In the meantime, the objection raised on the behalf of Vermont, an analogous motion that the Vermont Department of Financial Regulation filed mentions that an unclear relief is requested on the behalf of Celsius, paving the way toward letting the debtors resume the operations which infringe the state law. As asserted in the filing of the Vermont regulator, the intention of the debtors is ambiguous in the case of this type of sale.
Regulators Request the Court to Consider Creditors’ Interest
Additionally, the filing brought to the front that the requested relief further expands to the assets dominated by the stablecoin (like retail loans given to the customers). In the words of the regulators of both these states, nearly forty state regulators had been doing an investigation on Celsius. Therefore, they have appealed to the bankruptcy court to overturn the request filed by Celsius to prevail the sense of transparency along with keeping the interest of the creditors in view.
