Celsius Network, the embattled cryptocurrency lender that filed for bankruptcy protection earlier this year, plans to unstake a “significant” amount of Ethereum (ETH) in the coming days as part of its restructuring efforts.
Celsius Network, once a popular cryptocurrency lending platform, halted withdrawals and filed for Chapter 11 bankruptcy protection in July 2022 amid a liquidity crisis.
The company is now working to restructure and distribute assets to creditors. As part of that process, Celsius plans to unstake a large amount of its Ethereum holdings in the coming days, which it says will help offset costs.
Key details of the situation include:
- Qualified users are set to withdraw up to 72.5% of their holdings.
- Court documents show around 58,300 users have $210 million in custody assets.
- Celsius founder Alex Mashinsky faces fraud charges and will stand trial in September.
- Creditors’ recovery also involves a portion of $225 million in previously frozen crypto assets.
Upcoming “Significant” Unstaking:
In a tweet on December 10, 2022, Celsius announced that it would soon be unstaking “a significant amount of ETH” to help manage operating costs during the restructuring process. The unstaking event is expected to occur within the next few days.
Focus on Crypto Mining and Staking
Celsius plans to eventually relaunch as “NewCo,” focusing initially on staking and crypto asset mining. The company estimates that it could earn between $10-$20 million annually through Ethereum network staking.
In summary, Celsius Network’s upcoming unstaking of a large amount of Ethereum stands to provide much-needed liquidity and operational funds during the company’s complicated restructuring and bankruptcy proceedings. The proceeds will help offset costs as Celsius works to repay creditors and eventually relaunch in some form.