Bankrupt company Celsius can now convert its altcoins under management to Bitcoin (BTC) and Ether (ETH) thanks to a ruling from its New York bankruptcy court. This operation could be the consequence of the offensive policy of the Securities and Exchange Commission (SEC) vis-à-vis certain cryptocurrencies which it considers to be financial securities.
Celsius follows SEC talk
Last month, an American institution marked the international cryptocurrency industry: the Securities and Exchange Commission (SEC). The financial market regulator in the United States had said that many altcoins, like BNB, ADA, SOL and MATIC, were to be considered as “securities”or securities.
In this context, the bankruptcy court for the Southern District of New York has just authorized the owners of Celsius the conversion of altcoins from their platform into Bitcoin (BTC) and Ether (ETH).
“ Debtors, in consultation with Committee advisors, may sell or convert any non-BTC and non-ETH cryptocurrencies, tokens or other digital assets that are associated with holding or custodial accounts (collectively referred to as “Altcoins”) into BTC or ETH from July 1, 2023. »
As a reminder, in May 2023, the Fahrenheit consortium had won the auction relating to the takeover of Celsius. Thus, the future holders of the platform, formerly specialized in cryptocurrency loans, intend to revise the platform’s initial bankruptcy plan, starting with this operation directly targeting altcoins.
Celsius isn’t the only platform to pull away from altcoins because of the SEC attacks. Recently, the Révolut neobank has also stopped offering certain cryptocurrencies following the actions of the American policeman.
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Return on the bankruptcy of Celsius
In 2022, investors experienced one of the biggest domino effects that could have happened in Web3. The company that brought down many of the companies behind it is undoubtedly Terraform Labs, with the collapse of its two cryptocurrencies formerly valued at $40 billion.
The downfall of the Terra (LUNA) ecosystem brought down cryptocurrency lender Celsius. In July 2022, after weeks of tension caused by multiple rumours, the US-based company eventually relented and filed for bankruptcy.
In addition to the general dissatisfaction with the platform’s suspension of withdrawals, some revelations have worsened Celsius’ position in the cryptocurrency industry. Additionally, the company’s founder, Alex Mashinsky, reportedly withdrew $10 million from Celsius two months before filing for bankruptcy.
However, the worst was yet to come. Almost 4 days after this announcement, a 14,500-page long document began circulating on the web. The latter gathered the personal data of several thousand users, with their names, their transactions and their balances in cryptocurrencies.
Today, Celsius is trying to rise from its ashes with its potential takeover by Fahrenheit. If this operation is validated by the American regulators, the platform will benefit from 400 to 500 million dollars in the form of cryptocurrencies, as well as new mining installations.
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Published by Editions Larousse
Source: New York Bankruptcy Court
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