Celsius CEO unveils new plan to restructure the company
Alex Mashinsky intends to rebuild the firm into a custodial platform
14.09.2022 - 10:40
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What’s new? The head of the bankrupt crypto lending platform Celsius, Alex Mashinsky, plans to restructure the company. According to his plans, Celsius will focus on digital asset custody services and become a crypto custodial platform. According to The New York Times, the company will make money on fees for certain types of transactions. The project has a working name of Kelvin, after another unit of temperature measurement.
Material by The New York Times
What is known about Celsius’ plans? The platform said in a statement that it holds regular internal meetings to “prepare for all scenarios.”
Some Celsius employees were skeptical of Mashinsky’s proposal. In response, he compared the company’s restructuring process to the 1921 and 1932 bankruptcies of Pepsi.
In August, the committee of Celsius creditors began investigating “the prepetition conduct of Mashinsky and other Celsius insiders.” The Financial Times later revealed the reasons for Celsius’ large losses. According to journalists, Mashinsky thought the crypto market would decline, so he sold “hundreds of millions of dollars’ worth of bitcoin,” expecting to buy them back at a discount, but the market moved in the opposite direction and the company incurred large losses.
In early September, Celsius filed for a $50 million refund to customers. The funds are not part of the bankruptcy estate.
To find out what caused the bankruptcy of Celsius, one of the largest crypto lenders, see GetBlock Magazine’s feature.
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