- Celsius’s debut bankruptcy hearing introduces alternatives for users to retrieve their funds back.
- The firm plans to make use of Bitcoin mining operations and third-party asset sales to accumulate funds and pay back its debt.
After halting its withdrawals and filing for chapter 11 bankruptcy, Celsius Network has finally introduced a new recovery plan in its debut court hearing. The firm further intends to make use of Bitcoin minted by mining operations to accumulate funds to pay back its creditors.
Celsius Unveils A New Recovery Plan
In its first court hearing conducted on Monday, Celsius Network unveiled a comprehensive plan that outlines how the firm intends to pay funds back to its creditors.
Per the firm’s plan, Celsius intends to use Bitcoin minted by mining operations to help fund mining operations to grow Bitcoin holdings. According to a Reuters report, the firm has also received approval from US bankruptcy judge Martin Glenn to spend nearly $3.7 million on construction costs at a new Bitcoin mining facility and $1.5 million on customs and duties that will be required to be paid on imported customs mining rigs.
In its court hearing held on Monday, Celsius Network’s lawyer Patrick Nash further asserted that Bitcoin mining can be a lucrative way for the firm to pay back funds to customers whose assets were frozen after the firm halted its withdrawal, swaps, and transfers last month.
“In a world where the crypto market rebounds, the mining business has the potential to be quite valuable,” Nash later added
Per the shared plan, Celsius also intends to raise capital by considering asset sales and third-party investment opportunities.
In addition to this, the firm also stated that it will allow its users to retrieve their assets via accessing the cash at a discount option, or opt for another alternative referred to as “long crypto.” Furthermore, Celsius’s restructuring plan also includes efforts to maximize returns for stakeholders, alongside charting plans to reorganize the Celsius business.
As per a court transcript revealed by Twitter user Khadim, Celsius Network’s lawyer Patrick Nash asserted that the firm is not in favor of liquidation and intends to execute a recovery plan.
Later on, Nash also stated how crypto HODLing will be a crucial part of Celsius’s recovery plan, adding that a vast majority of people will be interested in beating the current crypto winter by holding their crypto for a long time to fetch better prices.
Crypto lender platform Celsius Network took the world by storm when it announced its decision to halt its withdrawals, swaps, and deposits citing extreme market conditions. The firm has been through a whirlwind of controversies since then, with accusations suggesting that the firm is involved in dubious Ponzi antics.
The firm had recently replaced its restructuring lawyers to maneuver its current crisis and had also filed for chapter 11 bankruptcy with plans to compensate funds back to its creditors.