A New York judge has allowed crypto lender Celsius Network to mine and sell bitcoin while it went bankrupt, despite protests from unsecured creditors. The troubled lender, which disclosed on Monday that it was running low on money, also disclosed that it had received several offers for cash injections without naming the parties that led them to such offers. Lawyers representing the exchange also claim that Celsius aims to grow its crypto mining operation as a way to get itself out of trouble with the investment.
according to Reuters report goodCelsius amended its proposal to specify that the proceeds from the sale of bitcoins generated by its mining rigs would be kept separate from the company’s cash management system, to satisfy creditors, many of whom are individual investors whose assets were tied up in bankruptcy. happened.
Before approving the motion, Judge Martin Glenn expressed concern that the mining business was not profitable, and Shara Cornell, a US trustee representing the interests of the Justice Department, objected to the motion, saying that the operation to approve it. But there is not enough clarity. ,
That said, Celsius is barred from selling equity or debt investments in other crypto companies until he provides more details about the assets he plans to sell, the judge said.
Estimate The law firm Kirkland & Ellis . filed by On August 14 it was learned that the lender may be out of funds by October. The firm also owes depositors a whopping $2.8 billion (about Rs 22,200 crore) in crypto compared to the firm’s current holdings.
Celsius filed for Chapter 11 bankruptcy last month after the crypto crash forced it to halt withdrawals.
However, the law firm’s estimates showed that as of August, the firm still has about $130 million (about Rs 1,000 crore) in cash balance, but it will be exhausted by October.
Taking into account all expenses such as operating, capital and restructuring expenses, Kirkland and Ellis still predict that the firm will be in the red at around $40 million (INR value) by the end of October.
The law firm disclosed a considerable imbalance between asset holdings and liabilities in the filing, and there was a $2.8 billion hole in crypto liabilities. As of now, with $2.5 billion (approximately Rs 19,800 crore) in BTC liabilities, the firm has $348 million (approximately Rs 2,800 crore) in BTC.
The firm found a spread of $1 billion (approximately Rs 100 crore) between ETH liabilities and ETH in hand, and a slightly less than $700 million (approximately Rs 5,600 crore) difference in USDC liabilities. In addition, Celsius has a difference of $625 million (approximately Rs 4,900 crore) among other crypto tokens.
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