Celsius Network, a crypto lender that went bankrupt, has reached two agreements that might help return assets to its customers and end the bankruptcy case.
The settlements will be reviewed by a judge on August 10 and involve $78.2 billion in unsecured claims.
Image by AI
The first agreement addresses accusations of fraud and misrepresentation by Celsius management. It will increase customers’ recoveries by 5%. Customers can choose to opt out of the settlement if they want to pursue their own claims against Celsius.
The second agreement is for customers who had funds in Celsius’ interest-bearing Earn. They will be able to get some of their crypto funds back, along with shares in the new company created after the bankruptcy.
Celsius Network filed for bankruptcy in July 2022 due to market turbulence caused by the collapse of the Terra ecosystem. A year later, its former CEO, Alex Mashinsky, was arrested on fraud and market manipulation charges. He pleaded not guilty.
On the same day, the Securities and Exchange Commission filed a lawsuit against Mashinsky and other Celsius executives for raising money through fraudulent offers. The Federal Trade Commission also fined the lending platform $4.7 billion for misusing user deposits.
Celsius Network can now exchange altcoins for BTC or ETH
Simon Dixon says Celsius can pay all USD claims if Bitcoin and Ether prices double