Search Inside Bitcoins

Celsius appoints a new legal team to navigate liquidity crisis

Celsius insolvency
Celsius insolvency

Join Our Telegram channel to stay up to date on breaking news coverage

The Celsius Network has turned to legal experts to help it explore restructuring options. The crypto lender has hired Kirkland & Ellis LLP law firm to advise it on restructuring and help overcome the ongoing liquidity crisis.

Celsius was among the companies that were dealt a blow by the collapse of Terra LUNA and the prolonged bear market. It halted withdrawals, swaps, and transfers in May, citing “extreme market conditions.”

Celsius hires law firm to help with restructuring

The WSJ report noted that Celsius has replaced the Gump Strauss Hauer & Feld LLP with a new law firm that will advise on restructuring and find a way forward for the platform. Before halting services, Celsius was a cryptocurrency lender that also offered interest rewards to those who provided the platform with liquidity by depositing funds.

The woes on the Celsius Network were caused by the firm’s exposure to Lido. Lido is a platform that allows users to explore Ether staking. The platform is popular with small investors that cannot afford the 32 ETH needed to secure a validator node on Eth 2.0.

Buy Bitcoin Now

Your capital is at risk.

When users deposit ETH on Lido, they receive the stETH token. After Ethereum transitions to proof-of-stake, 1 stETH token will be redeemed for 1ETH. stETH holders will only receive ETH after Ethereum switches to proof-of-stake, and the funds on the deposit contract are unlocked.

Celsius had a massive exposure to stETH. The stETH token depegged after the market was spooked by yet another delay in the launch of ETH 2.0. The token started trading at a discount, and the massive redemptions created liquidity issues on Celsius, forcing the platform to halt withdrawals.

Celsius proves to be resilient

While Celsius was among the first crypto firms to halt withdrawals, it has shown much resilience and even raised user confidence that normalcy will be restored. Some companies such as Voyager Digital and Three Arrows Capital have already filed for bankruptcy, but Celsius is still fighting on, and there are signs that it could survive the crypto winter.

Celsius is currently reducing its liabilities despite the losses suffered. Its debt to MakerDAO has now been fully repaid. Celsius recovered its collateral of 22K wBTC after repaying this debt. The wBTC was deposited to FTX, sparking rumors that they would be dumped into the market to enable the company to repay its other debts.

Read more:

Lucky Block - Our Recommended Crypto of 2022

Our Rating

Lucky Block
  • New Crypto Games Platform
  • Featured in Forbes,, Yahoo Finance
  • LBLOCK Token Up 1000%+ From Presale
  • Listed on Pancakeswap, LBank
  • Free Tickets to Jackpot Prize Draws for Holders
  • Passive Income Rewards - Play to Earn Utility
  • 10,000 NFTs Minted in 2022 - Now on
  • $1 Million NFT Jackpot in May 2022
  • Worldwide Decentralized Competitions
Lucky Block

Join Our Telegram channel to stay up to date on breaking news coverage

Read next


FightOut Presale - Earn Crypto for Working Out

FightOut Presale - Earn Crypto for Working Out

FightOut Presale - Earn Crypto for Working Out