Monday, November 28, 2022
 

Celsius’s Bankruptcy Case Approved by Independent Examiner

  • Judge Martin Glenn ordered an independent examiner to investigate Celsius’s operations.
  • Examiner will look into how and where Celsius stores crypto.
  • The Court will decide which documents Celsius must provide to the Examiner.

On September 14, U.S. bankruptcy judge Martin Glenn approved a motion to appoint an independent examiner to look into several elements of now bankrupt cryptocurrency lender Celsius’s business.

A federal judge supervising a bankruptcy case involving crypto lender Celsius has approved an independent examiner to look into a number of different aspects of Celsius’ operations, including the company’s crypto holdings.

The examiner would also look into why some customers were moved from the Earn Program to the Custody Service, why others were placed in a “Withhold Account,” the company’s procedures for paying various taxes, and the current status of Celsius’ utility obligations for its mining business.

Customers have been left wondering who is holding their funds and why, a problem that the U.S. Trustee had previously mentioned. This could be significant because Celsius had urged the court to return the funds to “custody clients” but not to “earn-and-borrow” clients.

The U.S. Trustee overseeing Celsius’ bankruptcy proceedings first requested the appointment of an examiner on August 18 due to “significant transparency issues” about Celsius’ business practices.

BnkToTheFuture.com CEO Simon Dixon, however, stated that the scope of the examiner’s probe had been reduced since the request was initially filed so that Celsius doesn’t run out of money.

In addition, Dixon indicated that Alex Mashinsky, CEO of Celsius Network, would be required to disclose any funds withdrawn from the service before it was frozen.

The ruling further added that once an examiner is appointed, they have seven business days to submit a proposed work schedule and budget. The examiner will have 60 days to complete their report after the court has approved the plan and budget, which will be done within seven business days.

Despite Celsius’s right to deny a request, the court will decide whether or not Celsius must give all records the examiner “reasonably deems relevant to perform the investigation.”

  • Judge Martin Glenn ordered an independent examiner to investigate Celsius’s operations.
  • Examiner will look into how and where Celsius stores crypto.
  • The Court will decide which documents Celsius must provide to the Examiner.

On September 14, U.S. bankruptcy judge Martin Glenn approved a motion to appoint an independent examiner to look into several elements of now bankrupt cryptocurrency lender Celsius’s business.

A federal judge supervising a bankruptcy case involving crypto lender Celsius has approved an independent examiner to look into a number of different aspects of Celsius’ operations, including the company’s crypto holdings.

The examiner would also look into why some customers were moved from the Earn Program to the Custody Service, why others were placed in a “Withhold Account,” the company’s procedures for paying various taxes, and the current status of Celsius’ utility obligations for its mining business.

Customers have been left wondering who is holding their funds and why, a problem that the U.S. Trustee had previously mentioned. This could be significant because Celsius had urged the court to return the funds to “custody clients” but not to “earn-and-borrow” clients.

The U.S. Trustee overseeing Celsius’ bankruptcy proceedings first requested the appointment of an examiner on August 18 due to “significant transparency issues” about Celsius’ business practices.

BnkToTheFuture.com CEO Simon Dixon, however, stated that the scope of the examiner’s probe had been reduced since the request was initially filed so that Celsius doesn’t run out of money.

In addition, Dixon indicated that Alex Mashinsky, CEO of Celsius Network, would be required to disclose any funds withdrawn from the service before it was frozen.

The ruling further added that once an examiner is appointed, they have seven business days to submit a proposed work schedule and budget. The examiner will have 60 days to complete their report after the court has approved the plan and budget, which will be done within seven business days.

Despite Celsius’s right to deny a request, the court will decide whether or not Celsius must give all records the examiner “reasonably deems relevant to perform the investigation.”

 

Latest news