Crypto Lender Celsius Should Continue Exclusive Right to Pursue Novawulf Deal, Judge Says
Enough progress has been made to suggest the plan to set up a new recovery corporation should be the only one on the table, Martin Glenn said
Celsius Network should continue to have the exclusive right to prepare a plan for exiting bankruptcy until the end of March, a bankruptcy court judge ruled Wednesday. Judge Martin Glenn said sufficient progress had been made in preparing a deal to set up a new recovery corporation with a new company, NovaWulf.
Agreeing to the deal could mean the crypto lender exits bankruptcy protection by the end of June, within a year of collapsing in 2022, the Southern District Court in New York was told.
“I'm going to grant the requested extension of exclusivity,” Judge Glenn said, despite complaints from the U.S. government and creditors that liquidating the company’s assets could still prove an option.
Celsius has been able to fill in details of the deal and isn’t burning through customer funds in the interim, Glenn said, urging lawyers to ensure the plan, due to be presented to creditors for their approval, is written in plain English.
Celsius appears confident a speedy resolution is still possible. On current timelines “that would mean that Celsius would be in and out of bankruptcy in under one year,” Christopher Koenig of Kirkland & Ellis, representing the bankrupt company, told the court.
Celsius’ interim chief executive officer, Chris Ferraro, also offered an update on the return of funds held in Custody accounts, which Glenn in December ruled belonged to customers rather than the estate.
As of Tuesday, $17.7 million had already been withdrawn from the custody accounts, with a further $3.5 million in progress, representing 60% of eligible users and 80% by value, Ferraro said.
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