Cryptocurrency lender Celsius announced the return of funds of some customers

Cryptocurrency lender Celsius announced the return of funds of some customers

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Author: Robert Strickland
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Cryptocurrency lender Celsius announced the return of funds of some customers
Lawyers for the bankrupt cryptocurrency lender have provided the court with a list of users who will be able to recover about 94% of their assets

After new revelations of misconduct by Celsius Network and its management, the bankrupt cryptocurrency lender said some customers will be able to withdraw assets. According to documents filed with the bankruptcy court on Jan. 31, users of a crypto-asset storage program called Custody will be able to withdraw about 94% of their assets. The court will decide whether to pay out the remaining 6% at a later date.

Early last June, Celsius, a major cryptocurrency lender with 1.7 million customers, said it was facing difficulties because of "extreme market conditions" and stopped operations.

In November, it became known that the bankruptcy court in the cryptocurrency lender Celsius Network bankruptcy case appointed an expert to examine the company's business model. Judge Martin Glenn deemed it necessary to find out whether the firm was operating as a pyramid scheme.


Celsius co-founder and former head Alex Maszynski, when promoting the company, claimed to know how to make high profits with low risk and claimed that Celsius customers would easily get their money back even in the event of bankruptcy. But Pillay claims that from the very beginning, Maszynski "in all key aspects of the business has conducted it very differently than he promised his clients."

According to the expert, Celsius concealed the fact that it spent at least $558 million to buy its own CEL token to support it in the marketplace, used new customer funds to pay off earlier customers, owed more than $16.5 million to tax authorities, and Mashinsky himself misled investors about his CEL token transactions.

The Custody program, whose users would be able to recover their assets, allowed cryptocurrencies to be stored in a Celsius account, exchanged and used as collateral for loans. No income was generated from the assets in such accounts.

The more than 1,400-page document lists the names of eligible customers who are eligible to receive payments. It also lists the amounts available to them for withdrawal in various cryptocurrencies.

The cryptocurrency lender is also considering reorganizing into a new publicly traded company with the appropriate license.

 

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