Celsius creditors, US gov oppose bankrupt’s lender extension request due to high cash burn rate

The U.S. government and creditors have objected to Celsius’ plan to extend its restructuring plan to June 30, according to Feb. 8 court filings.

Celsius wanted to extend its exclusive filing period until March 31 and its exclusive solicitation period through June 30, according to a Jan. 25 filing. The firm argued that it might have to liquidate assets if it could not “reach a definitive agreement” on its restructuring plan.

Celsius’ cash burn rate

Creditors are against the extension due to the bankrupt company’s high cash burn rate.

According to Celsius’ unsecured creditors, the firm could hit a “liquidity wall” within the next few months. The creditors said:

“Based on the Debtors’ cash burn rate and the rate at which professional fees are accruing in these cases, the Committee understands the Debtors’ expense rate and accrued liabilities indicate they could run out of cash by June 2023 unless they sell crypto assets to meet administrative claims and expenses.”

The U.S. Trustee corroborated this view. The Trustee argued that it was inappropriate to grant such extensions given the “rate at which professionals are consuming Debtors’ assets.”

Celsius creditors concluded that the cases must proceed toward a resolution as it has been around eight months since the firm paused withdrawals. They added that:

“During that time, many account holders’ lives and finances have been upended because of the past conduct of the Debtors and certain of their former directors and officers.”

The case will be heard on Feb. 15.

Meanwhile, Celsius recently published the names of its users eligible to withdraw their assets from its platform. An independent examiner report said the business operated like a Ponzi.

Bookmark (0)
ClosePlease loginn

Related Posts

A sincere thank you to our valuable sponsors: CoinDesk, Nexo and 1inch

A sincere thank you to our valuable sponsors: CoinDesk, Nexo and 1inch

Discover the cutting-edge services of CoinDesk and Nexo, the leading names in crypto and blockchain, and unlock the full potential of your digital assets.

Bookmark (0)
ClosePlease loginn
U.S. government sold over 9k BTC for $215.7M on March 14

U.S. government sold over 9k BTC for $215.7M on March 14

The US government said it plans to liquidate over 40,000 Bitcoin in four batches during this calendar year.

Bookmark (0)
ClosePlease loginn
Justin Sun’s Grenada ambassadorship to WTO ends

Justin Sun’s Grenada ambassadorship to WTO ends

Grenada’s local media reported that Justin Sun had been recalled after the political party that appointed him lost elections in June 2022.

Bookmark (0)
ClosePlease loginn
More than 50% of Bitcoin mining uses renewable energy

More than 50% of Bitcoin mining uses renewable energy

Almost a quarter of all Bitcoin miners use water to power their setups, while wind and nuclear are the second and third biggest contributors.

Bookmark (0)
ClosePlease loginn
Bittrex to halt US operations by end of April

Bittrex to halt US operations by end of April

The cryptocurrency exchange will only serve global customers going forward.

Bookmark (0)
ClosePlease loginn
Binance.US transitioning to new bank providers; briefly affecting deposits, withdrawals

Binance.US transitioning to new bank providers; briefly affecting deposits, withdrawals

Many transfer methods, including Signature ACH transfers, are affected.

Bookmark (0)
ClosePlease loginn

Leave a Reply

Your email address will not be published. Required fields are marked *