Celsius Seeks Account Holder Approval for User-Owned Relaunch

According to Bloomberg News, Celsius Network LLC will begin polling account holders on its plan to relaunch as a new user-owned company.

The crypto lender will begin sending ballots to account holders after receiving approval on Monday from U. S  Bankruptcy Judge Martin Glenn, who said he would allow Celsius to mail ballots to account holders along with voting materials explaining the company’s plan to repay its customers following its bankruptcy a year ago.

Glenn’s approval is also contingent on the company’s advisors supplying additional information about the volatility of the crypto industry as well as potential obstacles that its crypto mining operation may face.

According to Bloomberg News, a Celsius attorney stated that the company will begin repaying creditors by the end of this year.

Celsius declared bankruptcy in July 2022 and owes investors billions of dollars. In May, Fahrenheit’s crypto consortium won a proposal to acquire the crypto lender to launch a new business.

Bloomberg reported that individual Celsius account holders were dissatisfied with the crypto lender’s repayment plan because it required them to invest in a potentially risky new venture.

In the past year, former Celsius CEO Alex Mashinsky has drawn the ire of regulators. In January, New York Attorney General Letitia James filed a lawsuit against Mashinsky, accusing him of defrauding investors.

“As former CEO of Celsius, Alex Mashinsky promised to lead investors to financial freedom but instead led them down a path to financial ruin,” James said in a previous statement.

Later, a report by a court examiner revealed that Celsius placed hazardous wagers with customer funds.

The Securities and Exchange Commission subsequently filed a lawsuit against Mashinsky and Celsius last month, alleging they raised billions of dollars through fraudulent and unregistered sales of “crypto-asset securities.” Additionally, Mashinsky faces criminal offenses.