Celsius
Network, the digital asset lender that filed for bankruptcy
protection in July
last year, has selected Fahrenheit’s bid to restart the business under a new
name, NewCo. Fahrenheit is a group of investors that includes Bitcoin
mining company, US Bitcoin Corp.; crypto investment firm, Arrington Capital; and technology
consulting firm, Proof Group. Steven Kokinos, a former Algorand CEO, and Ravi
Kaza, an angel investor, are also part of the group.
Celsius announced the development on Thursday, noting that it also secured a backup bid with Blockchain
Recovery Investment Consortium (BRIC), which is a group of investors that fund
blockchain firms battered by the crypto market downturn. The agreement includes
provisions for the investors to fund a public mining firm potentially to be
managed by crypto miner GlobalXDigital.
🍎 @FahrenheitHldg won, #BRIC is backup. It’s official. Term sheet included. I’ll cover more on my Space tonight #Celsius Creditors https://t.co/jrCiZ7rv2A 🙏 to all who participated. https://t.co/CSk93ui5Wa
— Simon Dixon (@SimonDixonTwitt) May 25, 2023
Celsius
in a statement noted that Fahrenheit’s winning bid was selected after a
court-approved auction process and in partnership with the bankruptcy company’s
unsecured creditors. The bid proposes to provide the capital, management team
and technology needed to successfully establish and run NewCo, which will be owned
by Celsius creditors.
The bid selection comes after Celsius folded up in June 2022 after initially suspending crypto withdrawals
on its platform, citing market volatility. The digital asset lender became insolvent following the Terra-Luna collapse that sent shockwaves across the global crypto
industry last year.
In the
aftermath of its fall, Celsius has been facing several
investigations in the
United States and Alex Mashinksy, its Co-Founder, was recently charged with fraud. However, the latest development shows the failed digital
lending business is making progress in its efforts to reorganize under a new entity.
Customers
to Get ‘Hundreds of Millions of Dollars’
Announcing the winning bid, Celsius noted that Fahrenheit’s bid will be executed in
accordance with its reorganization plans. According to the plan, NewCo for the benefit of account holders will manage
Celsius’ illiquid assets, including its institutional loan portfolio, mining
business and alternative investments.
The plan
also provides for the distribution of ‘hundreds of…
