- With a substantial infusion of $450 million in seed funding, Celsius seems poised for a remarkable comeback, giving much-needed hope to other failed platforms.
- The customers and creditors could be compensated with $2 billion in cryptocurrency and stock in the new entity.
- Plans for a relaunch have been underway since August.
Bankrupt crypto firm, Celsius, is making steps towards a revival. With a substantial infusion of $450 million in seed funding, the company seems poised for a remarkable comeback, giving much-needed hope to other failed platforms.
According to the Bloomberg report, the company’s lawyer, Christopher S. Koenig, the legal genius behind Celsius, has unveiled an ambitious revival plan. This financial CPR is set to come from none other than Fahrenheit LLC, a group intricately linked to Celsius’ bankruptcy saga.
On May 25, court filings revealed that Fahrenheit was to acquire Celsius’s staked DeFi cryptocurrencies, institutional loan portfolio, $500 or $450 million in Liquid crypto, mining unit, and PE and VC investments. The court document listed the successful and backup bidders for Celsius Network, as the deal requires Fahrenheit to pay $10 million before the acquisition is completed.
Noteworthy, it will be a touch of phoenix for Celsius as it is poised to transition into a “user-owned Bitcoin miner,” potentially leaving the future of its lending business uncertain.
If all goes well, Celsius could more effectively compensate customers and creditors. The platform is striving to distribute $2 billion in cryptocurrency and offer creditors stock in the new entity, along with a stake in litigation against former Celsius CEO Alex Mashinsky and other executives. Further, the repayment process is slated to commence by the end of 2023.
Celsius’s Revival Blueprint Garners Substantial Support
On the other hand, Celsius’ revival blueprint has been under construction since August and has accumulated massive support. An impressive 95% of its customers have thrown their weight behind the endeavor. However, not everyone is dancing to the rhythm.
Meanwhile, some creditors are expressing doubt about the new firm’s valuation. Regulatory approval will be crucial for Celsius and its customers to move forward with the plan.
The recent developments in the reopening plan include the appointment of Steven Kokinos, formerly with Algorand, as the new CEO. Notably, this transition also witnessed the departure of Michael Arrington, CEO of Arrington Capital and founder of TechCrunch, from the board.
Conversely, the SEC opposes Coinbase’s role in Celsius’ token redistribution plan due to the ongoing legal dispute between Coinbase and the SEC. The SEC argues that Coinbase’s involvement goes beyond its designated role as a distribution agent. For now, Celsius’ redistribution plan is proceeding as intended.
