According to CryptoPotato, the bankrupt crypto lending firm Celsius may soon be able to pay its cash-based debts by liquidating its newly profitable Bitcoin (BTC) and Ethereum (ETH) holdings alone. This could result in the bankruptcy retaining more assets, while its counterparties are repaid at a far more difficult time to enter the crypto market. Celsius creditors have expressed concerns that the firm will be able to 'rug pull all creditors' if BTC reaches $54,879 per coin and if ETH reaches $3,750. These estimates were based on a 50/50 liquidation basis for each coin.
Celsius filed for bankruptcy in June of last year after collapsing crypto market prices forced the firm to freeze user withdrawals. A later examination of the company's balance sheet revealed it was $1.2 billion in debt. Last month, the company gained court approval for its bankruptcy restructuring plan, which involved transitioning into a Bitcoin mining/staking entity owned by NewCo creditors. It also involves distributing $2 billion worth of BTC and ETH to its customers.
If BTC and ETH continue to rise, the bankruptcy can repay all of its USD claims while retaining all other assets, according to a July thread by Simon Dixon, CEO of BankToTheFuture, a major Celsius investor. Customers held mixed feelings about such an outcome when discussing the matter on Tuesday. While some were dissatisfied about not receiving their owed crypto payouts, others were willing to settle for any immediate solution after 18 months of waiting.
