Celsius’ business model not as advertised – U.S. Bankruptcy Examiner

SINGAPORE, Jan 31 (Reuters) – Crypto firm Celsius Network advertised and sold to its customers a business model that it did not actually operate, a court-ordered examiner’s report released on Tuesday showed.

The report added that Celsius’s stablecoin deficit between May 28, 2021 and filing for bankruptcy equates to a $1 billion shortfall in its assets.

Hoboken, N.J.-based Celsius filed for Chapter 11 protection from creditors in Manhattan last July after freezing customer withdrawals from its platform. It posted a deficit of $1.19 billion on its balance sheet.

U.S. Bankruptcy Judge Martin Glenn, who oversees the Chapter 11 case, appointed former prosecutor Shobapillai as an independent examiner in September.

She was tasked with investigating allegations by Celsius clients that the firm was operating as a Ponzi scheme and reporting on its handling of cryptocurrency deposits.

Reporting by Rae Wee; Editing by Clarence Fernandez

Our Standards: The Thomson Reuters Trust Principles.

Source link