Celsius Network Requests Extension in Chapter 11 Restructuring
Cryptocurrency lending platform, Celsius Network, has submitted a request to extend its deadline for financial restructuring after filing for Chapter 11 bankruptcy.
The company is seeking an extension of its exclusive plan filing rights, previously set to end on February 9, until the end of March to finalize its proposal.
As a reminder, our motion requesting an extension of the general Bar Date, which is the deadline for all customers to file a claim, was approved by the Court earlier this year. In approving this motion, the Bar Date was extended to February 9, 2023 at 5:00 pm ET.
— Celsius (@CelsiusNetwork) February 2, 2023
The extension would allow Celsius to negotiate and present a feasible plan that addresses its debts and resolve its financial obligations.
The request has sparked discussion among the crypto community, as Celsius was once a popular choice for its high-interest rates and secure platform.
However, several objections have been raised, including from the US Trustee, unsecured creditors, and a group of borrowers, who question the company’s ability to create a successful restructuring plan.
A recent court-appointed examiner’s report criticized Celsius for poor risk management practices and false information provided to customers.
Once a prominent company in the industry, Celsius fell victim to the harsh conditions of the 2022 bear market and decided to freeze user funds. Shortly after, a domino effect came into place in which most of the crypto lenders came into insolvency, creating a bloodbath in the crypto markets where prices fell up to 90% for some coins.
Fortunately for the investors, the market is recovering steadily, and predictions are 2023 will be a good year for crypto.