2023-06-16 15:32:47
The now defunct crypto lender Celsius Network recently sought court approval to convert his altcoin holdings to bitcoin and ether. On June 14, Celsius filed an updated in a New York district court restructuring plan as part of the bankruptcy process. If the bankruptcy court approves the plan, Celsius will transfer all of its altcoins that it is required to hold in a non-segregated account on July 1st.
According to the borrowers, Celsius wants to outplay them
According to the filing, the exchange will be carried out on the basis of “commercially possible best intentions”. If any interested party objects to the exchange, they must express their objection in writing and electronically. The court will discuss these arguments on June 28. Celsius Network’s Official Committee of Unsecured Creditors has already approved the move. On the other hand, borrowers with collateral locked at the defunct company are now worried. They fear that they might lose their deposit due to the new plan, which would subject them to the so-called “net” procedure. Specifically, this procedure would allow Celsius to invalidate the security and refuse to pay it.
After all, this net procedure is the fair right of the creditor to deduct his debt to the debtor from his claim once morest the debtor arising from a separate transaction. David Adler, a partner at the law firm McCarter & English, who represents one such group of Celsius Network borrowers, said that the plan violates all existing “lending laws”. Therefore, on behalf of his clients, he intends to take legal action once morest him. According to Adler, Celsius has refused to communicate with them in recent weeks. In addition, without proper justification, he wants to extend the period during which he can exclusively propose a plan in relation to the bankruptcy plan.
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