A US judge has approved a bankruptcy plan for a crypto lender that filed for bankruptcy in July 2022 after its token plummeted by 99% and it was unable to fulfill withdrawals.
According to a recent court filing, the new plan from Celsius Network will generate funds for a new mining and staking corporate spinoff designed to repay creditors.
[adinserter block="1"]The company, dubbed “NewCo,” will have a $1.25 billion balance sheet, $450 million of which will be liquid crypto.
Explains bankruptcy judge Martin Glenn,
“NewCo intends to stake some or all of this liquid cryptocurrency to earn staking yields on the Ethereum network, which would generate anywhere from $10 to $20 million per year.”
The mining portion of the business has projected 2024 earnings before interest, taxes, depreciation, and amortization (EBITDA) of $61.8 million, according to Glenn.
NewCo will be owned by customers but managed by a collection of companies under the name Fahrenheit LLC.
The judge also notes that nothing in his order constitutes a finding under federal securities laws determining whether or not crypto tokens or transactions are securities.
“The right of the U.S. Securities and Exchange Commission to challenge transactions involving crypto tokens on any basis is expressly reserved.”
Celsius Network’s native token, CEL, is trading at $0.262 at time of writing. The 275th-ranked crypto asset by market cap is up nearly 5% in the past 24 hours.
Follow us on X, Facebook and Telegram
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any assets including cryptocurrencies, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated Image: Midjourney
