The bankrupt crypto lender, Celsius has won a court permission to poll on a proposal of it becoming a user-owned company. It also plans to distribute an approx $2 billion of Bitcoin and Ether.
According to an article from Bloomberg, the permission has been granted by the US Bankruptcy Judge Martin Glenn, which explains that existing account holders will be able to participate in the company’s reconstruction.Â
Celsius filed for Chapter 11 Bankruptcy in July, 2022 following the short of $1.2 billion of funds in its balance sheet. Its former CEO Alex Mashinsky was also arrested on disputes over allegedly manipulating the price of CEL token and securities fraud.
The plan also includes repaying customers through equity in a new company which will operate Celsius’ mining operations. The new company will take over Celsius’ institutional loans, private equity, venture capital deals and a $500 million of liquid cryptocurrency investment.
However, individual customers of Celsius are displeased with the new repayment plan citing that they are forced to take equity in a new venture which is also risky.
Also Read: Crypto Custodian Prime Trust Filed For Chapter 11 Bankruptcy
