Celsius News: Troubled Firm Hires New Lawyers
The latest Celsius news is that just 28 days after it halted withdrawals for its users, the troubled crypto lender decided to hire a new law force to help its restructuring process.
According to sources, the company replaced its lawyer advisers Strauss Hauer & Feld LLP with newly appointed Kirkland & Ellis LLP. The company still hasn’t filed for bankruptcy and hopes that pairing up with Kirkland & Ellis LLP could represent a shift in the overall strategy.
Celsius, which was managing almost $11.8 billion in assets for its 1.7 million users as of May, decided to pause all withdrawals last month, explaining that "extreme market conditions" led to this decision.
As sort of a buffer, Celsius proposed high-yield loans of up to 18% on deposits and reiterated its users "will continue to accrue rewards" during Celsius’s “half-time”.
"We are taking this necessary action for the benefit of our entire community in order to stabilise liquidity and operations while we take steps to preserve and protect as diligently in order to face all challenges," the company said.
Be it as it may, Celsius isn't the only crypto firm collaborating with Kirkland & Ellis. Voyager Digital, which recently filed for chapter 11 bankruptcy, also went with the company to try to solve the issues of its clients' wanting to withdraw funds from the company.
Celsius, however, hasn't been in an enviable situation. An ex-crypto money manager has sued the company on charges that Celsius used client funds to cover its deficits in the lending business. According to Arkham Intelligence, that manager is said to have cost Celsius $61.2 million in liquidations.
The company has allegedly also approached Alvarez & Marsal for restructuring options and, in late June, it fired John Stephen Dubel, founder of restructuring services provider Dubel & Associates, after only eight days of service.
In last week's Celsius news it was confirmed that the company had managed to repay its debt to Maker, giving back 41.2 million in DAI that unlocked 21,962 in wrapped Bitcoin (WBTC), worth around $440 million.
Blockchain intelligence firm Nansen revealed that Celsius now has a total of $213 million in outstanding debt; 63% of this falls to Aave and 35% to Compound.
Author: Teuta Franjkovic
A sincere writer with a strong will to share knowledge on all things blockchain, crypto, metaverse and DeFi. Starting out as a writer with Cosmopolitan, Teuta has risen through the ranks of business journalism, editing newspapers and websites within the fintech industry for over 15 years. She holds a double MA in Public Politics and Entrepreneurship.