Search Inside Bitcoins

Fahrenheit Deal Offers New Hope For Celsius As Crypto Lender Now Has New Bankruptcy Plan

Don’t invest unless prepared to lose all the money you invest. This is a high-risk investment, you shouldn’t expect to be protected if something goes wrong.

Farenheit Wins Celsius Bid
Farenheit Wins Celsius Bid

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

The Fahrenheit consortium, made up of venture capital firm Arrington Capital and miner US Bitcoin Corp, has emerged victorious in the bid to acquire the assets of crypto lender Celsius. The court filings early on Thursday confirmed Fahrenheit’s win, beating rival bidder NovaWulf and securing the assets previously valued at around $2 billion.

This proposed treatment violates every consumer lending law out there.” – David Adler

Celsius filed for bankruptcy in July after liquidity issues amid a bank run following plummeting crypto prices. The lender’s failure served as a precursor to challenges other prominent crypto exchanges, lenders, and venture capital firms faced. This led the industry into a significant downturn.

Fahrenheit Secures Acquisition of Insolvent Crypto Lender Celsius, Faces Legal Opposition to Bankruptcy Plan

The deal includes Celsius’s institutional loan portfolio, staked crypto, mining unit, and more alternative investments. To close the deal, Fahrenheit must provide a deposit of $10 million within three days. However, the proposal may face legal opposition from borrowers, who argue that Celsius has failed to return their collateral.

The bankruptcy plan, updated by Celsius, shows the successful bid by the Fahrenheit group. Filed Thursday, it now requires approval from the New York bankruptcy court leading the wind-up process. Nevertheless, creditor pushback is expected because of concerns over compliance with customer lending laws.

Representing a group of borrowers, David Adler challenged the proposed treatment and vowed to oppose the plan. He echoed the importance of the Celsius group showing progress and effective communication with stakeholders. According to him, this would help maintain the right to propose a bankruptcy plan. Adler expressed frustration, stating that his clients have been neglected and treated poorly throughout the past seven weeks.

As part of the Fahrenheit deal, the new company will receive a significant amount of liquid crypto. This is estimated to be between $450 and $500 million. Additionally, US Bitcoin Corp plans to set up crypto mining facilities, including a 100-megawatt plant.

Acquisition Finalization Is Subject To Regulatory Approval

The crypto industry has faced regulatory hurdles that affected asset sales. For instance, Binance.US’s acquisition of Voyager’s assets was terminated due to regulatory uncertainties. Accordingly, the acquisition’s finalization is subject to regulatory approval.

The ongoing legal opposition and regulatory considerations surrounding the acquisition and bankruptcy plan highlight the complex nature of crypto-related insolvencies. The outcome of these proceedings will have implications for borrower rights, compliance with lending laws, and the future of distressed crypto lenders. The Celsius-Fahrenheit saga reminds us of the risks and volatility within the crypto industry, emphasizing the importance of robust regulatory frameworks and effective risk management for market participants.

As the crypto industry constantly evolves, all stakeholders must maintain vigilance and adapt to shifting regulatory landscapes. The Celsius-Fahrenheit case, a notable incident in the industry, acts as a crucial turning point that calls for introspection and reflection. This case compels market participants to reevaluate their risk management strategies and compliance measures to ensure alignment with changing regulations.

It highlights the importance of robust and effective risk management frameworks to mitigate potential legal and regulatory risks. Market participants must closely monitor regulatory developments and proactively adjust their operations and policies to maintain compliance. This includes implementing thorough Know Your Customer (KYC) procedures, enhancing Anti-Money Laundering (AML) measures, and fostering transparency in transaction reporting.

By taking heed of this pivotal moment, stakeholders can bolster their resilience in an evolving regulatory environment.

Adapting swiftly and effectively to evolving regulations will mitigate potential legal risks and foster trust and credibility within the crypto industry. This could lead to its long-term growth and sustainability.

Related News

Smog (SMOG) - Meme Coin With Rewards


Smog token
  • Airdrop Season One Live Now
  • Earn XP To Qualify For A Share Of $1 Million
  • Featured On Cointelegraph
  • Staking Rewards - 42% APY
  • 10% OTC Discount -
Smog token

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

Read next