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Celsius Teases the Birth of a New Token as Part of Restructuring Program

WikiBit 2023-01-28 19:43

Abstract:There might be a new Celsius token shortly. According to a Bloomberg article, Celsius is thinking of releasing a new cryptocurrency token as part of its restructuring efforts.

A new Celsius token could be coming soon. Based on a Bloomberg article, Celsius is considering issuing a new cryptocurrency token as an aspect of its attempts to restructure. This would permit the company to generate money and pay off its creditors. In a court proceeding on Tuesday, Celsius' lawyer Ross M. Kwasteniet argued that, as contrasted to just liquidating its limited assets at current prices, a fully licensed and publicly listed firm, such as a reborn Celsius, would indeed be capable of raising more revenue for creditors.

According to reports, the reorganization plan has indeed been discussed with Celsius' creditor parties and is being put to a vote; however, the vote isn't going to be taken into consideration by the court when reaching its judgment. The lender's ideas are not the only ones to use a novel token to get around financial difficulties.

Bitcoin exchange Bitfinex, which introduced the LEO Token in 2019 to compensate damages from its transactions with Panama-based Crypto Capital, is one of the previous instances of cryptocurrency businesses creating tokens. In another instance, Poolin, a Cryptocurrency mining pool with headquarters in Beijing, stopped accepting withdrawals in September and resolved the issue by creating IOU (I Owe You) debt coins.

According to Kwasteniet, the resources of the new firm, should the tribunal approve Celsius' reorganization proposal, would comprise a portfolio of loans and other investment, in addition to Bitcoin mining equipment run by Celsius. The Celsius' lawyer noted that court documents describing the suggested plan would be made public.

Crisis with Celsius' finances

The troubled cryptocurrency lender revealed a $1.2 billion hole in its income statement when it declared bankruptcy protection in July of last year, allowing users to receive payments on their digital assets.

Along with dealing with demands from creditors and allegations of conducting a Ponzi scheme, Celsius also got involved in a legal battle with the Bitcoin mining firm Core Scientific, which in itself failed in December after ceasing to pay its portion of the electrical bills. The two insolvent businesses agreed to turn off 37,000 Celsius mining machines earlier in January, which Core said was costing the company up to $53,000 per day.

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