- On May 4, Celsius announced that its customers would have the opportunity to withdraw the remaining 6% of their funds.
- In January, the attorney general’s office of New York filed a lawsuit against Celsius.
Celsius Network, a platform for lending cryptocurrency, has revealed that specific customers will soon have the opportunity to reclaim their entire initial investments. This comes after almost a year since the company temporarily paused withdrawals.
Previously, users of Celsius who solely held their funds in custodial accounts were limited to withdrawing 94% or less of their balance.
Following a court order, Celsius announced on May 4 that its customers would now have the opportunity to withdraw the remaining 6% of distributable custody assets. Prior to the beginning of this year, these customers were only able to withdraw 94% of their funds from their custody accounts.
After suspending withdrawals in June 2022 and subsequently filing for bankruptcy in July, this recent announcement marks the initial progress towards providing compensation to certain Celsius clients affected by the frozen withdrawals.
Despite the funds being theoretically available, numerous Celsius customers have reported significant delays in their withdrawal requests, spanning several days. Court documents indicate that Celsius aimed to consolidate its British and American operations to ensure consistent handling of the respective bankruptcies.
Claims of Inadequate Record-Keeping Emerge
Amid a legal dispute between its customers and Series B investors, the struggling cryptocurrency company is now facing accusations of inadequate record-keeping within its organizational framework.
In January, New York’s attorney general’s office filed a lawsuit against Celsius, naming both founder and former CEO Alex Mashinsky as defendants. On May 2nd, Mashinsky submitted a motion to dismiss the attorney general’s complaint, asserting that it merely repeats false information.
In 2021, the United Kingdom’s Financial Conduct Authority (FCA) issued a warning to Celsius Network Limited, urging the subsidiary to cease its activities in the UK. In response, the company established a Limited Liability Company in Delaware and attempted to transfer assets through a series of financial transactions.
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