Celsius Network Denies Recommendation by Their Lawyers To Go Bankrupt

Celsius Network is resisting the recommendation from its lawyers to file for bankruptcy according to the Block. They also seek a show of support from users to help win the internal argument against the suits.

A user on Twitter said they spoke to a Celsius representative and that although he said, "take it for what it's worth," the Celsius representative said, "I wouldn't believe everything you read. We are still here and want to be."

Furthermore, it appears Celsius has begun to pay down their debts, according to cryptoworldalert on Twitter. He said, "Over the last few days, #Celsius have bought down their debt by $280M, and today they have paid back $30M."

Celsius's management was prevented from making any public announcements because of legal advice, but Celsius thinks many of their retail clients would prefer if the firm avoided bankruptcy, according to people with knowledge of the situation. Celsius claims that users can show support by engaging "HODL Mode" on their accounts.

This is Celsius's last attempt to stay afloat in the wake of freezing clients' accounts on the 12th of this month. The company offers retail investors returns on their crypto holdings, holding more than $10 billion in assets on behalf of their clients. On the 12th, the company found itself unable to honor their liabilities as crypto markets tanked a few weeks ago.

According to Celsius's website, the aforementioned "HODL Mode" is a "security feature that allows you to temporarily disable outgoing transactions from your Celsius account." The mode makes clients unable to withdraw or send funds. Following the deactivation of the mode, users have to wait 24 hours before the ability to sell is reinstated.

Alex Mashinsk, Celsius CEO, has previously welcomed scrutiny and had a "ask me anything" event every Friday. His legal team has now asked him to refrain from public statements making any future transparency unlikely. 

Author: Garrett Meifert

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