Celsius Network, one of the largest cryptocurrency lending platforms in the world, has filed for bankruptcy protection in U.S. court under Section 11 of the Bankruptcy Code after the company was hit hard by volatility in the crypto market.
Celsius said Wednesday (July 13), “The company is looking at ways to stabilize its business through a restructuring approach. which is expected to add maximum value to all shareholders. The company currently has about $167 million in cash to support the business going forward.”
Celsius is the latest well-known crypto company to decide to file for bankruptcy protection.
Earlier on July 6, Voyager Digital, a U.S. digital asset broker, filed a Section 11 receivership motion in U.S. court for damages incurred because Three Arrows Capital (3AC) defaulted on a loan it was obligated to pay to investors. The amount of the loan is $670 million.
The report said a New York court last week ordered the freezing of 3AC’s assets. The company is currently in the process of writing off assets to pay down debt, according to the court order.
Numerous crypto companies suffered losses back in May when the stablecoin, TerraUSD or UST, collapsed.
In addition, the U.S. Federal Reserve (Fed) has accelerated interest rate hikes. Recession worries have unsettled stock markets worldwide and triggered a sell-off in the crypto market.