Crypto lending platform, Celsius Network, is dealing with new legal concerns as displeased users take legal action to retrieve their assets after the platform halted withdrawals in June.
The U.S. Bankruptcy Court for the Southern District of New York on Wednesday received a lawsuit from an unofficial group of 64 Celsius custodial account holders seeking the return of their funds.
In all, the bitcoin assets stored in Celsius’ custody service are valued at more than $22.5 million, according to court filings. The creditors are attempting to retrieve these assets. The bankruptcy-focused law firm Togut, Segal & Segal is defending the ad hoc organization.
“Celsius will not transfer, sell, loan or otherwise rehypothecate eligible digital assets held in a custody wallet unless specifically instructed by you, except as required by valid court order, competent regulatory agency, government agency or applicable law,” the statement reads.
Celsius Network Trying to Recover from the Bear Market
Celsius Network is a financial platform that allows users to purchase and trade cryptocurrencies. It is also a cryptocurrency software that enables you to purchase 10 cryptocurrencies, which you can then exchange for more than 30 different e-currencies.
One of the numerous crypto lending platforms that have encountered significant problems as a result of the present bear market and related liquidity problems in the crypto lending industry is Celsius Network. The majority of the company’s obligations, totaling $1.2 billion, are owing to its customers. In the middle of July, Celsius filed for Chapter 11 bankruptcy protection.