Bankrupt Lender Celsius to Unstake $470 Million Worth of Ethereum (ETH)
Crypto lending platform Celsius, which is currently undergoing bankruptcy proceedings, is set to unstake and potentially sell around $470 million worth of Ethereum (ETH), according to on-chain data. Celsius used to offer customers yield on their crypto deposits but collapsed due to alleged mishandling of customer assets. The company’s founder, Alex Mashinsky, was arrested and charged with fraud. In an effort to compensate its customers, Celsius is now liquidating its remaining assets. The company announced via social media platform X that it has begun the process of unstaking its Ethereum holdings, which it had been using to generate income. This activity will unlock ETH for timely distributions to creditors.
New Plan to Generate Funds
A judge approved a new plan from Celsius late last year, which aims to generate funds for a new mining and staking corporate spinoff called “NewCo.” This spinoff is designed to repay creditors and will have a balance sheet of $1.25 billion, with $450 million in liquid crypto. NewCo plans to stake some or all of this cryptocurrency on the Ethereum network to earn staking yields, generating $10 to $20 million per year.
Hot Take
Bankrupt lender Celsius is taking steps to compensate its customers by liquidating its remaining assets, including unstaking nearly $470 million worth of Ethereum (ETH). This move comes after the company collapsed due to alleged mishandling of customer assets and the subsequent arrest of its founder. By unstaking the ETH holdings, Celsius aims to unlock funds for distribution among its creditors. Additionally, a new plan has been approved that involves creating a mining and staking spinoff called “NewCo” with a balance sheet of $1.25 billion, including $450 million in liquid crypto. This plan is intended to generate funds for repaying creditors through staking yields on the Ethereum network.
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