Fahrenheit Leads Bidding at Bankruptcy Auction as Celsius Starts High
Numerous crypto lenders, including Celsius, filed for Chapter 11 protection in July as a result of the industry's rapid growth amid the COVID outbreak. At the time, Celsius asserted to have over 1.7 million registered users in addition to over 300,000 active users with $100 or more in their account balances.
At a U.S. bankruptcy court hearing in Manhattan on Wednesday, a lawyer for Celsius Network stated that the cryptocurrency lender wants to wrap up an auction for its assets within days and that the current lead bidder is Fahrenheit LLC, a group that also includes blockchain-based venture capital firm Arrington Capital.
Ross Kwasteniet, an attorney for Celsius, told U.S. Bankruptcy Judge Martin Glenn that although the auction took longer than anticipated, it was extremely competitive. According to him, the new offers are "hundreds of millions of dollars" greater than the opening offer made by the digital asset investment company NovaWulf LLC.
Celsius bankruptcy auction nears end and Fahrenheit is in the lead
A lawyer for Celsius Network said at a bankruptcy court hearing in Manhattan on Wednesday that the cryptocurrency lender wants to finish an auction for its assets in a matter of days and that Fahrenheit LLC, a group that also includes blockchain-based venture capital firm Arrington Capital, is currently the top bidder.
Although the auction went longer than expected, Ross Kwasteniet, a lawyer representing Celsius, told U.S. Bankruptcy Judge Martin Glenn that it was exceedingly competitive. He claims that the latest proposals are "hundreds of millions of dollars" more than the first offer made by the firm NovaWulf LLC, which invests in digital assets.
As a result of the industry's explosive expansion during the COVID epidemic, numerous crypto lenders like Celsius filed for Chapter 11 protection in July. At the time, Celsius claimed to have more than 1.7 million registered members as well as about 300,000 active users with account balances of $100 or more.
On April 22, Celsius started an auction in an effort to locate a buyer who might save its bitcoin mining and crypto lending operations from bankruptcy. It took Celsius longer to create further offers from Fahrenheit and Blockchain Recovery Investment Committee (BRIC), a holding company connected to the Winklevoss-owned Gemini Trust, than it had originally intended to accept NovaWulf's offer.
Since both provide a method for Celsius to carry on with both its loan company and its bitcoin mining operation, Celsius intends to pick between the Fahrenheit and NovaWulf proposals. Kwasteniet added that although Celsius has not established a deadline for final proposals, it anticipates wrapping up the auction in a week.
In the event that the Fahrenheit or NovaWulf bids do not receive regulatory clearances, BRIC's proposal, which would solely protect the mining industry, will act as a backup bidder.
Kwasteniet stated that he does not anticipate Celsius to experience the same fate as Voyager Digital, a cryptocurrency lending business that was forced to go out of business because regulatory issues stalled Binance.US's intent to purchase it.
We are sure that either party could complete a transaction since we have maintained the regulatory considerations at the forefront of our minds, Kwasteniet added.
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