Celsius Network, an insolvent crypto lender has yet to execute its restructuring plan, even after four months of Chapter 11 bankruptcy filing. The ailing lender has now submitted a petition to the court asking for permission to submit its reorganization plan after the original deadline has passed. On Twitter, Celsius disclosed on Thursday that the job is complex and must be well planned.
The company asserts that it is making “substantial progress toward the determination of a value-maximizing path forward” and that any disruptions could jeopardize the overall objective for all parties concerned. In addition, the lender stated that it was necessary to address some critical legal concerns before the matter could be resolved.
Troubled Celsius Network
Just a reminder that Celsius Network filed for bankruptcy in the middle of July, around a month after they stopped allowing withdrawals, swaps, and inter-account transfers. At that time, it has been unable to get withdrawals back up and running for some consumers despite the company’s best efforts.
The troubled cryptocurrency lender has applied for permission to liquidate its stablecoin reserve. However, Celsius’s request for funding was denied by three Texas regulatory authorities because, they said, the company did not provide sufficient justification for its financial needs.
Former CEO Alex Mashinsky resigned in September, citing his position as a distraction for the company as the firm wavered during its reorganization process.
There were reports that Mashinsky had mishandled client assets during his stay at the firm, and they began to surface less than a week after his resignation. The business’s former CEO allegedly withdrew $10 million in May, weeks before the company froze withdrawals, and reported this to the official unsecured creditors’ committee (UCC).
Previously, CEO of FTX, Sam Bankman-Fried was showing interest in the auction for Celsius’ assets until he ran into his own financial difficulties and he himself had to resign amid collapse.