Celsius's CEL Token May See 20 -Cent Value in Recovery Process, Attorney Says

The token currently has a market value of 54 cents.

AccessTimeIconFeb 15, 2023 at 3:54 p.m. UTC
Updated Feb 15, 2023 at 5:41 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

An attorney for bankruptcy crypto lender Celsius Network said the company might value its CEL token at 20 cents during the recovery process, down significantly from its current market value of 54 cents.

The native token of the now-defunct crypto lender once traded at an all-time-high of $8.02 – which regulators and Celsius’ independent examiner now say was the result of price manipulation meant to benefit insiders, including former CEO Alex Mashinsky.

In the wake of the revelations, lawyers for Celsius are wrestling with how to compensate CEL token holders without rewarding insiders who have enormous CEL holdings.

“I don’t think we’ve reached a 100% final conclusion there, but given the fact that the examiner report reveals in great detail how the price of CEL token was manipulated, we’ve really struggled with how to treat the CEL token and what is a fair value to ascribe to it,” Celsius’ lead attorney, Kirkland & Ellis's Ross Kwasteniet, told U.S. Bankruptcy Judge Martin Glenn.

“It’s our intention to suppress or subordinate the CEL token claims of insiders who were involved in the manipulation of the CEL token price,” Kwasteniet added. “It’s our intention that they would not receive any recovery or distribution on account of the CEL token.”

Celsius’ lawyers added that, if the estate were to value CEL tokens at the price of the petition date, it would take away value from the recovery given to holders of other cryptocurrencies.

Celsius customers attending the Wednesday hearing were not happy with the suggested recovery price.

“I would just hope that [the Unsecured Creditors Committee] take into consideration that a lot of the retail users did not buy [CEL] at 20 cents. We bought at all time highs, all the way down,” said pro-se creditor Jason Iovine. “It’s just more punishment on the retail users.”

UPDATE (Feb. 15, 2023, 16:30 UTC): Adds additional detail.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Cheyenne Ligon

Cheyenne Ligon is a CoinDesk news reporter with a focus on crypto regulation and policy. She has no significant crypto holdings.

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.