Celsius to Restructure and Focus Exclusively on Bitcoin Mining Following SEC Feedback
Summary:
Following feedback from the SEC, Cryptocurrency lending firm Celsius is restructuring its operations to focus solely on Bitcoin mining. Some assets, previously planned for transfer, will remain with the firm under the new structure. The company is expected to file modifications for the new formation in the coming weeks and still plans to start distributing to creditors in January 2024. This follows Celsius' Chapter 11 protection filing last year and a lawsuit from the SEC.
Following feedback from the United States Securities and Exchange Commission (SEC), cryptocurrency lending platform Celsius has decided to streamline its restructured company towards Bitcoin mining only. The entity, known as 'NewCo', was initially set to handle both mining and staking, but following suggestions from the SEC and discussions with the Official Committee of Unsecured Creditors, the decision was made to solely focus on Bitcoin mining.
Under this restructuring arrangement, some assets initially slated for transfer to 'Fahrenheit NewCo' will instead be kept by the firm. The intent is for this 'Mining NewCo' to be a public entity traded within the United States and owned by Celsius customers. Modifications to the plan, reflecting the new Mining NewCo transaction, are expected to be filed with the Bankruptcy Court in the coming weeks. Celsius assures that these changes will not necessitate re-solicitation of the plan. It also anticipates that payouts to creditors will start in January 2024.
Last year, Celsius filed for Chapter 11 protection in the U.S Bankruptcy Court for the Southern District of New York, following a pause in platform withdrawals. A year later, the SEC filed a lawsuit against the company and Alex Mashinsky, its former CEO, accusing him of falsely promising a safe investment through the company’s Earn Interest Program.
The former CEO was later arrested by U.S. Justice Department authorities, accused of securities fraud, commodities fraud, and wire fraud in connection with allegedly swindling customers. Mashinsky is currently out on a $40 million bail, awaiting a trial expected to commence in September 2024.
Published At
11/21/2023 3:03:14 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.