Bankrupt crypto lender Celsius is seeking to extend its bid dates as it goes through the submissions for the platform and its mining business. The Southern District of New York’s bankruptcy court authorized deadlines for the bid on November 2, 2022. However, the company needs extra time to evaluate and screen each proposal.
The official statement says,
“This extra time will allow for further engagement with the bidders so that the Debtors can work to bring these chapter 11 cases to a value‐maximizing conclusion.”
Acting CEO Chris Ferraro will give another update during the hearing on December 20 in court. The update will cover the bidding procedure, the mining operations of the crypto lender, and negotiations surrounding a stand-alone restructuring.
The statement says that the firm is dedicated to resolving the chapter 11 matters in a way that maximizes value. The Debtors think that the best approach to accomplish that aim is to postpone specific dates and deadlines defined by the bidding procedures.
Furthermore, this is not the first time Celsius has applied for an extension. In November, the firm wanted to extend the Exclusivity Period in its case. The crypto lender wanted more time to work on its restructuring plan.
How did the Crypto Lender collapse?
In June 2022, Celsius filed for bankruptcy. According to Bloomberg, Celsius co-founder and CEO Alex Mashinsky said the platform’s digital asset count increased faster than Celsius was prepared to deploy. Mashinsky stated that, as a result, the business made poor choices in how to use the assets.
As of July 13, 2022, the crypto lender had around $4.31 billion in assets and $5.5 billion in liabilities, according to court records. Mashinsky stated under oath that the company’s attempts to secure further finance from outside sources made it evident that bankruptcy was necessary. Following the bankruptcy filing, there were more customer flights, which caused the withdrawals to stop.
In September, the crypto lender announced plans to revive the business as a custodian, holding clients’ crypto for them.