Celsius has temperatures rising as parties claim priority over lost equity
A new faction of creditors have emerged in the Celsius [CEL] bankruptcy saga. Shareholders or investors with equity in the crypto lender have staked their claim for the bankruptcy payouts. Furthermore, these investors also filed a motion in the ongoing bankruptcy case.
Milbank LLP, filed a motion in the ongoing bankruptcy proceedings on behalf of the shareholders. The motion demanded the appointment of an “Official Preferred Equity Committee” to represent shareholders that invested in Series A and Series B funding rounds of Celsius.
The Celsius Series B funding round was led by equity firm WestCap, and Caisse de dépôt et placement du Québec (CDPQ) in October 2021. The round closed after raising $400 million at a valuation north of $3 billion. Furthermore, in November 2021, Celsius revealed that the round had been oversubscribed. This brought the total funds raised from Series B to a whopping $750 million.
To say that shareholders are lining up for their share of the pay-out would be inaccurate. On the contrary, shareholders are asking for a higher priority than the original victims, the account holders. Shareholders wish to skip the que and want to be the first ones to benefit from the sale of certain assets.
Celsius owes almost $5 billion to half a million creditors. Executives at the bankrupt company are now looking to turn their debt into a crypto token. An audio of an internal meeting at Celsius was shared by Tiffany Fong, a popular Celsius victim. CTO Guillermo Bodnar can be heard outlining a plan to issue IOU cryptocurrencies to customers with regards to their compensations.
Furthermore, Celsius co-founder, Nuke Goldstein, also explained how “wrapped tokens” will serve as an IOU for customers who were a part of
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