By Michael Scott
The insolvencies will benefit creditors in the near future by creating a path for fund distribution.
Celsius Network, a bankrupt crypto lender, has had its plan to change its altcoins into Bitcoins by the U.S Bankruptcy Court for the Southern District of New York. Judge Martin Glenn issued the order, and this winding up will aid creditors in receiving funds in the near future.
SEC Talks with Celsius Networks Yields Permit to Replace Altcoins with Bitcoin and Ethereum
The official approval of the proposal took place following discussions between Celsius and the United States Securities and Exchanges Commission (SEC). Based on the ruling by the bankruptcy judge, the troubled lender is permitted, from 1st July 2023, to change or trade in cryptocurrency into ETH or BTC. This excludes tokens linked to Custody accounts or Withhold.
In 2022, Celsius was hit by bankruptcy after the Terra ecosystem and its TerraUSD (UST) and Terra (LUNA) tokens collapsed. This situation has compelled creditors to wait for an answer. Despite filing for bankruptcy some months ago, the current judgment has led to the introduction of other possibilities and also led to the proceedings’ extension.
Security Label Triggers Crypto Operators’ Race to Convert Altcoins into Bitcoin and Ethereum
Amid the ongoing crackdown on altcoins by the SEC, most crypto organizations are striving to change altcoins into ETH and BTC. Solana, Cardano, and Polygon are famous altcoins that the SEC has classified as securities.
Despite the continuing bankruptcy proceedings, Fahrenheit, a crypto consortium, recently purchased Celsius in May 2023. Its new owners currently govern the operations of the network.
An announcement by the new owner reveals their aim to create a reviewed bankruptcy strategy. Despite the failure to disclose the plans’ particular details, there is evidence of the owners’ will to distribute Bitcoin’s and Ether’s assets.
Organizations, for instance, FTX and Voyager, experienced financial issues following Celsius Network’s insolvency. The situation evoked the need to embrace special interventions to address creditor repayment demands.
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