Celsius applies for approval to sell its stablecoin reserves
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Answer Celsius applies for approval to sell its stablecoin reserves
In the latest development in Celsius’ ongoing Chapter 11 bankruptcy case, the now-beleaguered company has sought approval to sell its stablecoin reserves.
In the request, Celsius leadership stated that the company’s assets include approximately $23 million in stablecoins, spread across entities in the US, UK and EU, respectively.
An intriguing detail is that although the US and UK branches are listed as debtors in the documents, the EU branch – Celsius Network EU UAB – is described as non-debt.
Resources will ensure funding for Celsius operations:
The application by the company does not seek to free up funds in order to pay worried creditors.
Rather, the money will be directed toward financing Celsius’ operating costs – raising doubts about whether the court will see this as an appropriate use of the debtors’ dwindling assets.Read:The disappearance of one of the most famous automated trading tools “trading bot” and the embezzlement of investors’ money in a new fraud
Previously, Judge Martin Glenn, who is chairing the case, had already approved a proposal made in August to allow Celsius to mine and sell bitcoin, despite the fact that the lender had warned the court that the activity would not immediately generate profits due to the required investments in mining infrastructure. .
So far, the company has only allowed $50 million to be withdrawn to creditors with custody accounts.
According to the document, the initial investigation into Celsius’ request did not violate any existing laws.
This is due to the fact that the assets proposed for sale are stable currencies and therefore do not fall within the purview of laws prohibiting or restricting the rights of debtors to sell assets that are at risk of depreciation or appreciation.
The document also clearly states that the preliminary decision should not be taken as an indication of the court’s approval and that the matter will be discussed at the scheduled hearing.Read:Terra 2.0 launch postponed and announcement of how to get LUNA airdrop
Unfortunately, about 80% of Celsius users do not have a custodian account, which means that the stablecoins deposited by them are now subject to sale by the team.
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