Bankrupt Celsius Network Files Complaint Against EquitiesFirst Holdings to Recoup Assets


This article has been republished with permission from Binance News.

According to CryptoPotato, Celsius Network, a bankrupt crypto lender, has filed an adversary complaint against EquitiesFirst Holdings in an attempt to recover assets. The private lender reportedly owes Celsius $439 million, which includes $361 million in cash and 3,765 BTC as of July 2022. The filing seeks injunctive relief and a declaratory judgment related to the recovery of money and property, with EquitiesFirst and its CEO, Alexander Christy, listed as defendants.

EquitiesFirst, founded in 2002, specializes in long-term asset-backed financing and began offering crypto-collateralized loan services in 2016. In 2019, Celsius sought financial assistance from EquitiesFirst to support its operations, but their overcollateralized crypto loan faced difficulties by 2021. In July of this year, it was revealed that the Indianapolis-based private lending platform was the mysterious debtor to Celsius, owing the troubled firm $439 million.

Celsius filed for Chapter 11 bankruptcy protection in July 2022, following the sharp decline in the cryptocurrency market. A year later, co-founder and former CEO Alex Mashinsky was arrested and now faces several charges, including securities fraud and manipulation of the company’s native CEL token. The Federal Trade Commission imposed a $4.7 billion fine on Celsius for allegedly deceiving users, but the judgment was temporarily halted to allow the platform to incorporate these funds into its bankruptcy proceedings. In mid-August, a proposed settlement plan was approved, which, if accepted, would involve a consortium known as Fahrenheit acquiring Celsius’s assets and reimbursing creditors through the establishment of a new company.

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