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    Celsius Network LLC to Sell Lending Platform and Creditors Propose to Sue Executives for Misconduct


    Bankrupt cryptocurrency firm Celsius Network LLC has reached a deal to sell its lending platform to NovaWulf Digital Management LP as part of a plan to distribute its coins and other assets to customers.[0] According to court documents filed on Wednesday, NovaWulf has agreed to make a direct cash contribution of $45 million to $55 million to a new company that it will manage.[1]

    The official committee of Celsius creditors is also proposing to sue Celsius co-founder Alex Mashinsky and other executives for “fraud, recklessness, gross mismanagement and self-interested conduct” that eventually led to the collapse of the crypto lender.[2] They allege that the executives made “negligent, reckless (and sometimes self-interested) investments” causing Celsius to lose $1 billion in a single year, while mismanagement led to another quarter-of-a-billion dollar loss “because they could not adequately account for the company’s assets and liabilities.”[3]

    In July, due to the drastic drop in cryptocurrency values, Celsius's risky investments went awry, leading to their filing for bankruptcy.[4] One of many digital-asset lenders, this company fell victim to the market crash of last year.[5]

    Court filings on Feb. 8 indicate that the U.S. government and creditors have opposed Celsius' intention to prolong its restructuring plan until June 30.[6] An impromptu collection of debtors also submitted their complaint to the U.S. Bankruptcy Court in the Southern District of New York.[7] Celsius failed to provide justification for prolonging the proposed solicitation deadline, the court was informed.[7]

    The filing, which was 150 pages long, detailed the possible recovery, fees, and punitive penalties based on the 33 allegations.[8] Furthermore, the report illustrated billions of dollars being directed towards KeyFi, a decentralized finance (DeFi) platform in which Mahinsky has a stake.

    The document also referred to the transfer of billions of dollars to DeFi platform KeyFi, which was partly owned by Mashinksky. The filing states that the investment caused Celsius to incur a loss of approximately $200m.[9]

    Meanwhile, according to an interim CEO Christopher Ferraro in a bankruptcy court filing dated Feb. 9, 2023, defunct cryptocurrency lender Celsius aims to secure more than $14 million from credits and coupons backed by Bitmain.[10] The company plans to price the coupons at $7.[10]

    0. “Bankrupt Crypto Lender Celsius Selects NovaWulf in Deal to Restart Operations” The Wall Street Journal, 15 Feb. 2023,

    1. “Bankrupt crypto lender Celsius finds a buyer in NovaWulf Digital Management” Axios, 15 Feb. 2023,

    2. “Celsius creditors committee proposes suing Mashinsky, other Celsius execs By Cointelegraph”, 15 Feb. 2023,

    3. “Celsius Creditors Move To Sue Mashinsky, Other Executives For Fraud” The Deep Dive, 15 Feb. 2023,

    4. “Celsius Set to Sell Retail Trading Platform to NovaWulf”, 15 Feb. 2023,

    5. “Cash Burn at Bankrupt Celsius Sparks Ire Over Plea for More Time” msnNOW, 9 Feb. 2023,

    6. “Creditors, Borrowers, and US Trustee Object to Celsius delaying reorganization plan” Blockchain.News, 11 Feb. 2023,,-and-us-trustee-object-to-celsius-delaying-reorganization-plan

    7. “US gov't, creditors oppose Celsius' proposed restructuring extension” CoinGeek, 14 Feb. 2023,

    8. “Celsius to Recover ‘Fraudulently Transferred' Funds from Former CEO, Other Senior Execs” Coinspeaker, 15 Feb. 2023,

    9. “Celsius Pursues Legal Action: Mashinsky and Other Former Executives Targeted for Repayment in Bankruptcy Fallout” Cryptonews, 15 Feb. 2023,

    10. “Bankrupt Celsius Aims to Raise $14.4 Million From Bitcoin Mining Rig Credits and Coupons – Bitcoin News” Bitcoin News, 11 Feb. 2023,

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