Major crypto lender Celsius files for bankruptcy

Celsius files for bankruptcy: US crypto lender Celsius Network said it filed for bankruptcy in New York on Wednesday, becoming the latest victim in the cryptocurrency sector of a dramatic drop in token prices.

New Jersey-based Celsi us Network company has suspended the withdrawals last month itself, citing “extreme” Crypto market conditions, cutting off access to savings for individual investors, and sending tremors through the crypto market. Celsius files for bankruptcy.

U.S. Attorney for the Southern District of New York. In a bankruptcy court filing, Celsius estimated its assets and liabilities at between $1 billion and $10 billion, with more than 100,000 creditors. The Celsius Network company has a total $167 million in cash on hand.

“This is the right decision for our community and company,” said Alex Mashinsky, Celsius co-founder and chief executive. Celsius files for bankruptcy.

Celsius files for bankruptcy

Crypto lenders like Celsius have boomed during the COVID-19 pandemic, attracting depositors with high-interest rates and easy access to loans that traditional banks rarely offer. They mostly issued tokens to institutional investors, profiting from the difference.

But the lender’s business model came under scrutiny after a sharp sell-off in the crypto market, fueled by the collapse of major tokens Terra USD and Luna in May.

Another big Crypto lender from the US, Voyager Digital Limited noted and filed for bankruptcy in July after canceling the deposits and withdrawals. Singapore’s smaller Crypto lender company Wald also suspended its withdrawals from this month.

Celsius said in a statement that it is not seeking authority to allow customer withdrawals, and has asked the court to allow it to continue operations such as paying employees.

Celsius’ move to freeze withdrawals in June prompted state securities regulators in New Jersey, Texas, and Washington to launch investigations into the firms.

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