Celsius Shifts Focus to Bitcoin Mining
Celsius, a cryptocurrency lending platform, has announced a change in its reorganization strategy, moving from a focus on staking and mining to a new company exclusively dedicated to Bitcoin mining. This shift comes after feedback from the U.S. Securities and Exchange Commission and will see Celsius concentrating solely on Bitcoin mining activities.
Transition to Mining NewCo
As part of the new strategy, Celsius is now registering shares for a new publicly traded Bitcoin mining company called ‘Mining NewCo,’ which will be owned by its customers. This marks a departure from the initial plan, which involved establishing a company focused on mining and staking with responsibilities assigned to Fahrenheit Holdings.
Despite the changes, Celsius aims to begin distributing funds to creditors in January 2024, with some assets initially intended for transfer to Fahrenheit Holdings now being retained by Celsius’ estates due to regulatory considerations.
Celsius’ Plan for Customer Funds Recovery
In July 2022, Celsius filed for Chapter 11 bankruptcy protection after freezing customer accounts to prevent withdrawals, following a significant collapse. However, the company has since taken a unique path to revival, with plans to recover customer funds through its reorganization strategy.
Furthermore, a group led by Arrington Capital announced intentions to acquire a minority stake in the restructured Celsius for $50 million, with plans to publicly list the new company’s stock on Nasdaq, allowing customers to sell their equity shares as part of the bankruptcy recovery.
Hot Take: Celsius Rethinks Strategy, Focusing on Mining
Celsius’ decision to shift focus from staking to a new entity exclusively dedicated to Bitcoin mining represents a bold move in response to regulatory feedback. With plans to recover customer funds and distribute funds to creditors, the company is taking steps to redefine its position in the crypto industry.
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