Celsius creditors’ committee says it will investigate conduct of Mashinsky and other insiders

A committee representing unsecured creditors of bankrupt crypto lender Celsius Network released its first official statement last night.

The group has repeatedly singled out Celsius CEO Alex Mashinsky, saying it intends “to thoroughly investigate the conduct of Mashinsky and other Celsius insiders, including problematic deployment decisions. of assets, pre-petition transfers and other issues”.

Celsius suspended withdrawals on June 12 and, a month later, filed for Chapter 11 bankruptcy in New York. At that time, the company said it had over 100,000 creditors.

The Official Unsecured Creditors Committee was appointed on July 27, according to yesterday’s statement. It is made up of seven individual and institutional representatives who have lent funds through the platform. They are Caroline G. Warren, Thomas DiFiore, ICB Solutions, Christopher Coco, Andrew Yoon, Mark Robinson and Covario AG.

“The Committee’s objective is to maximize recoveries from account holders and unsecured creditors,” he said in the statement. “The Committee intends to be a vigorous participant in the Debtors’ bankruptcy and to put the interests of the Debtors’ account holders and unsecured creditors first.”

The group has engaged White & Case, the law firm, as counsel, along with restructuring adviser M3 Partners and blockchain consultancy Elementus. He also appointed Perella Weinberg Partners, an investment bank specializing in restructuring, to advise on “potential transactions” that could help recoup funds from lenders. Finally, he is appointing Kroll “to establish a website and call center to provide information regarding the bankruptcy process to account holders and unsecured creditors.”

Potential bitcoin sales accrued through the mining operations of Celsius and GK8 — the security company it acquired for $115 million in November last year — are under review, according to the committee’s statement. The committee will also consider “strategic options to reorganize or sell the business (or parts of it) to maximize value for account holders and unsecured creditors.”

Celsius owes $1.2 billion more than it has in assets, according to a statement made by Mashinsky.

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