Celsius Network LLC has submitted an updated bankruptcy plan after Fahrenheit’s successful acquisition. According to the filing, which was made public in the early hours of June 15th, the wind-up requires authorization from the New York bankruptcy court.
Fahrenheit is a group that includes the blockchain-based venture capital company Arrington Capital. In late May, the defunct crypto lender announced Fahrenheit’s proposal as the winning bid to manage a new entity to be owned by its creditors.
The venture capital firm will offer the funding, management team, and technology necessary to launch and operate the new company under the name NewCo.
As part of the Fahrenheit deal, the new firm will receive between $450 and $500 million in liquid cryptocurrency, and US Bitcoin Corp will build a range of crypto mining facilities including a new 100-megawatt plant.
New Jersey-based Celsius filed for Chapter 11 protection last July, one of several crypto lenders to go bankrupt during the COVID pandemic.
Two months later, Mashinsky, the CEO of Celsius, resigned from his position after acknowledging the organization’s poor asset deployment choices. Chris Ferraro, who had previously served as CFO was made the interim CEO.
The collapse of one of the leading crypto firms was attributed to problematic decisions and the then prevailing market conditions.
To recall, Celsius’ precarious condition was exacerbated by the LUNA’s fiasco coupled with an overleveraging issue, and the poorly executed WBTC and ETH/stETH positions that led to a total lockdown of their platform.
The firm made headlines again after kicking off an auction on April 22, as it looked for a buyer to save its bitcoin mining and crypto lending operations from bankruptcy.
Fahrenheit’s Acquisition Of Celsius- Terms & Conditions
Following Fahrenheit’s win, Celsius’s institutional loan portfolio, staked cryptocurrencies, mining units, and additional alternative investments would go to the former under the terms of the acquisition. Additionally, the group deposited $10 million to seal the deal.
As Celsius embarks on a new chapter with Fahrenheit, it’s vital for the two parties involved, the crypto industry, and especially others who are recovering from similar difficulties.
The Celsius Network bankrupt story nevertheless serves as a sobering reminder of how quickly things may turn out in the erratic world of cryptocurrency. After one year, the purchase of Fahrenheit gives the struggling business hope.