Judge rules $4.2B belongs to Celsius News ▸ Celsius ▸ Bankruptcy
Judge rules $4.2B belongs to Celsius
Judge Martin Glenn ruled that the funds deposited in Earn Accounts belong to Celsius
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Updated: Jan. 5, 2023 at 1:56 am UTC
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A new update regarding the Celsius bankruptcy case came on Jan. 4 as Judge Martin Glenn ruled that the funds deposited to Earn Accounts, which amount to $4.2 billion, are the property of Celsius, not the investors.
The ruling document states:
“The Court concludes, based on Celsius’s unambiguous Terms of Use, and subject to any reserved defenses, that when the cryptocurrency assets (including stablecoins, discussed in detail below) were deposited in Earn Accounts, the cryptocurrency assets became Celsius’s property; and the cryptocurrency assets remaining in the Earn Accounts on the Petition Date became property of the Debtors’ bankruptcy estates (the “Estates”).”
According to the document, Celsius had around 600,000 accounts in its Earn program when the account holders filed the lawsuit. The funds deposited in these accounts amounted to $4.2 billion as of July 10, 2022.
Many account holders argued that they were entitled to their funds and requested full returns. If the Judge were to side with the account holders, this decision would tie their recovery to the distributions to unsecured creditors under a confirmed chapter 11 plan.
Celsius had secured an extension for submitting a chapter 11 reorganization plan on Dec. 6, 2022. The bankrupt lender has until Feb. 15, 2023, to submit a detailed plan disclosing how it will maximize profit for all creditors and stakeholders.
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Zeynep Geylan
Zeynep is an academic who turned to crypto in 2018. Originating in social sciences, she is especially interested in the social impact of blockchain and cryptocurrencies and strongly believes in their transmuting power.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Celsius Network
Celsius Network is a bankrupt cryptocurrency lending company that was founded in 2017 and headquartered in Hoboken, New Jersey.
