Home ›› 15 Jul 2022 ›› World Biz
Cryptocurrency investment platform Celsius announced on Wednesday that it had filed for bankruptcy in the US, a month after it froze withdrawals from its platform, in the latest sign of an industry in turmoil.
In its statement, Celsius, which suspended withdrawals in mid-June, said it was seeking to restructure in a way that would maximize value for all stakeholders, and said it had $167 million of cash available to meet urgent needs in the meantime.
Without the freeze on withdrawals, “the acceleration ... would have allowed certain customers -- those who were first to act -- to be paid in full while leaving others behind to wait,” the special committee of the Celsius board of directors was quoted in the statement as saying.
In the United States, Chapter 11 allows a company that is unable to pay its debts to restructure away from its creditors, while continuing its current operations. “This is the right decision for our community and company,” said Alex Mashinsky, co-founder and CEO of Celsius.
“I am confident that when we look back at the history of Celsius, we will see this as a defining moment, where acting with resolve and confidence served the community and strengthened the future of the company.”
Last week, cryptocurrency lending specialist Voyager Digital also filed for bankruptcy.
Other companies have suspended withdrawals, such as CoinFlex and Babel Finance, due to a lack of cash.
