Celsius set to burn $137.2M in 3 months as bankruptcy proceedings continue News ▸ Bitcoin · Ethereum ▸ Bankruptcy
Celsius set to burn $137.2M in 3 months as bankruptcy proceedings continue
Celsius' total liabilities surpass its assets by $2.84 billion and its liquidity is expected to drop to negative $33.92 million by October.
2 min read
Updated: Aug. 15, 2022 at 6:53 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Embattled crypto lender Celsius filed for Chapter 11 bankruptcy in July and filed new documents in court on Aug. 14, detailing its budget for August through October.
According to court documents, Celsius expects its net cash flow to turn negative to the tune of $137.21 million in the three months ending in October.
Huge operating expenses, which add up to $85.37 million for the period, are the major contributor to the negative cash flow. Of this $85.37 million, the lender has allocated around $13.95 million toward paying employees till October. Another $57.27 million is dedicated to hosting expenses related to mining activities.
Additionally, the documents showed that Celsius also expects to spend around $33.48 million on restructuring activities alone by the end of October.
As a result of the decreasing cash flow, the lender’s liquidity at the end of August is expected to be around $66.39 million, according to the documents. However, by the end of October, the figure is expected to dwindle to a negative $33.92 million after sliding to $11.05 million in September.
In addition to the expenditure forecast, Celsius also filed a coin report detailing its crypto assets and liabilities. According to the document, Celsius received 100,669 Bitcoin (BTC) from its users as deposits as of July 29. However, the lender only owned 14,578 BTCs at the end of July, valued at around $348 million at current prices.
The document showed that the document showed that the lender’s total Bitcoin liabilities add up to 104,962 Bitcoins, worth around $2.5 billion. Celsius also owned $557 million worth of Wrapped Bitcoin (wBTC) as of July 29.
Similarly, Celsius’ total Ethereum (ETH) liabilities amount to 1,045,291 ETH, worth around $1.78 billion at current prices. But at the end of July, the company only owned less than half that number of Ethereum, valuing up to only around $713 million at current prices. According to the document, Celsius converted 410,514 Ethereum tokens to Lido staked Ethereum (stETH) — its stETH holdings are valued at around $683 million as of July 29.
It is important to note that at the time of writing, both wBTC and stETH were trading at a slight discount to Bitcoin and Ethereum, respectively.
Celsius also has a deficit in its USD Coin (USDC) holdings. The lender owes $944.84 million worth of USDC tokens while it owned only $278.75 million worth of USDC on July 29, the document showed.
But the lender has a large excess of CEL tokens with only $323 million in liabilities and $761 million in holdings.
The lender’s total token liabilities amounted to $6.67 billion at the end of July but its digital assets only amounted to $3.82 billion. This left a total deficit of $2.84 billion for Celsius.
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Author 
Monika Ghosh
In 2020, Monika immersed herself in crypto, maintaining skepticism yet firmly believing blockchain could address key issues like financial disparity and transparency. A book-lover, she's also a passionate food enthusiast.
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Celsius Network is a P2P decentralized lending & borrowing platform.
Bitcoin
$97,526.73
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Ethereum
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Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Celsius Network
Celsius Network is a bankrupt cryptocurrency lending company that was founded in 2017 and headquartered in Hoboken, New Jersey.