• NovaWulf Digital Management has agreed to acquire bankrupt cryptocurrency company Celsius.
• If the proposal is accepted, creditors would receive majority of their money back in form of BTC, ETH and USDC if they had less than $5,000 in their lending accounts.
• NovaWulf will contribute up to $55 million to the reformed business, which will continue the lending and bitcoin mining operations of Celsius.
NovaWulf To Acquire Bankrupt Celsius
An agreement in principle has been reached for NovaWulf Digital Management to acquire bankrupt cryptocurrency company Celsius. Out of the more than 130 bids it received during its bankruptcy case, Celsius chose NovaWulf’s offer. The arrangement has been approved in principle by both parties but still requires the bankruptcy court’s and creditors‘ consent before moving forward.
Payment Plans for Creditors
If the proposal put out by Celsius is accepted by US Bankruptcy Judge Martin Glenn who is overseeing Celsius‘ Chapter 11 procedure, those assets would be held by Celsius creditors and managed by NovaWulf under a profit-sharing agreement. According to the proposal’s conditions, 85% of Celcius‘ clients will receive around 70% of their claims in liquid cryptocurrency. Larger creditors will obtain tokenized shares in the new company that will trade on Provenance Blockchain through a licenced broker-dealer.
NovaWulf has agreed to contribute up to $55 million to the reformed business which will continue with loan and bitcoin mining operations as previously done by Celsius and also be held by its creditors. Court filings state that NovaWulf will receive a portion of earnings from this new set up as well.
Celsius Filing For Bankruptcy
Celsius filed for US bankruptcy after freezing customer withdrawals in July while reporting more than 1.7 million registered members with 300k active users having an account balance of at least $100 each. The official committee of unsecured creditors additionally stated that they were attempting recover money from former CEO Alex Mashinsky and other executives who served as prior leaders for the company before going bankrupt.
In conclusion, if all goes according to plan after judge approval then customers with smaller amounts can expect liquid crypto returns while larger ones can look forward to tokenized shares trading on Provenance Blockchain from Figure Technology via licensed broker-dealers along with profits from NovaWulf contributions amounting up to $55 million .