Celsius sues thousands of users who withdrew money within 90 days before bankruptcy! Angered by creditors

This site (120btC.coM): Celsius, a cryptocurrency lending platform once valued at US$3 billion, officially emerged from bankruptcy at the end of January this year after an 18-month restructuring process and will establish a new Bitcoin mining company. Mining company Ionic Digital, owned by Celsius’ creditors. It is understood that its mining operation is managed by Hut8 and has promised to start distributing more than $3 billion in cryptocurrency and fiat currencies to creditors.

In January this year, the bankruptcy administrator of Celsius stated that in order to recover more assets to repay creditors, it had notified creditors on the 9th, requesting those who had used it within 90 days before the platform declared bankruptcy (July 13, 2022). Account holders who withdrew more than $100,000 must return 27.5% of their principal by January 31 in exchange for a settlement or face legal action. Celsius stated in the notice that if it complies with the regulations, it will be eligible to receive future distributions under the reorganization plan; otherwise, it may be sued.

Celsius sued thousands of users who withdrew money within 90 days before bankruptcy

Now, according to a netizen, he was really sued by Celsius. The netizen said that when he first received the letter, he thought it was a scam because he thought the requirement to pay 27% of the total principal looked like a large-scale blackmail.

However, Celsius this week officially filed a lawsuit in a New York court against thousands of users in an attempt to recover funds they withdrew in the 90 days before bankruptcy. Only then did he realize that it was true, and broke down and shouted: "This is just crazy!"

Previously, FTX also required users who withdrew funds within 11 days before bankruptcy to return their funds, which was usually understood as a pursuit of some insiders. Funds fled, but Celsius' request for a 90-day lookback period sparked controversy. The netizen said: "We are just ordinary users, using the platform normally, not insiders or bad people."

Celsius asked to repay the funds at the price of June 14 this year

The most ridiculous thing is that Celsius asked to repay the funds at the price of June 14 this year The funds will be repaid at the market price, not the 2022 price. The price of Bitcoin in July 2022 was approximately US$21,000, while the price on June 14 this year was US$66,700, a difference of more than three times. This made the netizen shout: "WTF!!".

The netizen said that although Celsius claimed that the money was to be redistributed to creditors, he thought it was a joke because most of the money would go into the lawyers' pockets. He concluded by calling on everyone in the industry to unite against this lawsuit because it will destroy the lives of thousands of innocent people. He believes that the only reasonable settlement method should be to claim the "profit" part of the past 90 days, rather than the principal.

Freeze users in June 2022

On the eve of bankruptcy in July 2022, Celsius froze all users’ accounts in June and claimed that its assets were sufficient to meet users’ withdrawal needs. However, Celsius was subsequently accused of insolvency before bankruptcy. False representations were made for several days to mislead consumers into believing that their deposits were safe.

Former Celsius CEO Alex Mashinsky has also been charged with multiple counts of fraud and market manipulation. The U.S. Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and Federal Trade Commission (FTC) have all filed lawsuits against him, accusing him of misleading investors during his management of Celsius and manipulating the price of CEL tokens for personal gain. . He pleaded not guilty to the charges and was released on $40 million bail in the middle of last year.

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