Fahrenheit Consortium Wins Bid to Purchase Celsius Network

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Bankrupt crypto lender Celsius Network has recently made headlines with the surprising announcement of its acquisition by a consortium known as Fahrenheit. Accordingly to the deal Fahrenheit will offer the funds, management team, and technology to launch a new firm called NewCo.

Celsius gave the announcement on Thursday, highlighting that the Company, in collaboration with its Official Committee of Unsecured Creditors chose Fahrenheit, LLC as the winning bidder after a meticulous court-approved auction process.

The acquisition consortium includes Arrington Capital, US Bitcoin Corp., Proof Group, Steven Kokinos, and Ravi Kaza. Each member adds distinct knowledge, experience, and resources to the table, making the consortium a strong force in assisting Celsius’ restructuring efforts.

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Key Provisions of the Acquisition Plan

According to the announcement, the purchase is subject to certain conditions, including a $10 million deposit and regulatory approval. 

One of the significant elements of the Plan is the distribution of Celsius’ liquid crypto to account holders. Additionally, the Plan includes provisions for settlements with the Custody and Withhold groups.

Furthermore, the ownership structure of NewCo will be designed to benefit Celsius’ account holders. They will own 100% of the new equity in NewCo, providing them with a stake in the future success of the entity. However, the management team of NewCo would be compensated with $35 million in annual management fees.

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To ensure oversight and accountability, a new Board of Directors will be established for NewCo. The majority of the board members will be appointed by creditors, representing a concerted effort to safeguard the interests of all stakeholders involved in the purchase.

Consideration for Celsius’ Mining Business

Celsius stated that Fahrenheit’s winning proposal not only provides financial stability but also appealing potential for the resuscitation of its mining operations. Recall that the defunct crypto lender earlier filed a notice of sale for its mining machines amid falling revenues and broader market challenges.

By reactivating these rigs, Celsius can resume mining operations and potentially generate additional revenue for the Company.

Celsius Network Backup Plan

Furthermore, Celsius intends to secure a backup plan sponsor agreement with the Blockchain Recovery Investment Consortium (BRIC).

Interestingly, the BRIC is a holding company backed by the Winklevoss twins’ Gemini Trust, Van Eck Absolute Return Advisers Corporation, and Global X Digital. This agreement serves as a backup plan in the event that the initial agreement with Fahrenheit is hampered or fails to materialize. 

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