After the crypto lending platform Celsius halted operations on June 12, at 10:10 p.m. (ET), two days later the Wall Street Journal (WSJ) quoted “people familiar with the matter” who said Celsius was hiring restructuring lawyers. At the time, the WSJ said Celsius was looking to hire the bankruptcy and restructuring law firm Akin Gump Strauss Hauer & Feld LLP. However, a new report from the WSJ claims sources say that Celsius is now working with the restructuring advisory firm Alvarez & Marsal.
Sources Say Celsius May Be Collaborating With a Restructuring Advisory Firm
The current financial situation of the crypto lending company Celsius is still unknown and since June 12, people still suspect that the firm is insolvent. Bitcoin.com News reported on the rumors and speculation that surrounds the company to this day and on June 13, the crypto lending firm Nexo offered to buy Celsius-based assets.
The reason why people suspect that Celsius is having financial hardships is because of the company’s tweet on June 12. “Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, swaps, and transfers between accounts,” Celsius revealed. There’s also been speculation about Celsius having 17,919 WBTC leveraged in Maker protocol that faced liquidation.
On June 14, a WSJ report said that Celsius was looking to hire the restructuring law firm Akin Gump Strauss Hauer & Feld LLP. “People familiar with the matter” explained that Celsius was attempting to get help from investors first. At the time, Akin Gump did not comment on the matter when it was asked if the firm was involved with Celsius. Now, another WSJ report says that Celsius may be collaborating with the restructuring advisory firm Alvarez & Marsal.
People Familiar With the Matter Claim Goldman Sachs Has Eyes on Celsius Network Assets
Additionally, Coindesk’s Tracy Wang reported that “Goldman Sachs is looking to raise $2 billion from investors to buy up distressed assets from troubled crypto lender Celsius.” Wang detailed that the information stemmed from “two people familiar with the matter.” The report goes on to explain that the two sources said the proposed Goldman Sachs deal “would allow investors to buy up Celsius’ assets at potentially big discounts in the event of a bankruptcy filing.”
A report from Reuters further detailed that the U.S. Securities and Exchange Commission (SEC) and state regulators were investigating Celsius over the account freeze. Other accounts have said that Akin Gump and the financial giant Citigroup told Celsius they recommended it file for bankruptcy. The report that discusses Akin Gump’s and Citigroup’s alleged recommendation said that both companies declined to comment on the subject.
After Celsius paused withdrawals, there haven’t been many words from the company except a blog post that tells the Celsius Network community that the company’s “objective continues to be stabilizing our liquidity and operations.” Celsius added that the “process will take time” but the post does not detail what type of process it meant. In the comment section, Celsius is criticized a great deal over the issue.
“Basically you have added nothing to what you have already said. Which is, per se, very little already,” an individual wrote in response to the company’s statement. “The lack of transparency is very concerning,” another person said. “Choosing Celsius was the worst choice of my life,” a Medium user called “Crypto Cooper” wrote five days ago. CEL, the Celsius Network’s native token is down 80.9% during the last 12 months and 86.3% lower than the asset’s all-time high.
What do you think about the report that says Goldman Sachs is reportedly looking to purchase distressed assets from crypto lender Celsius? Let us know what you think about this subject in the comments section below.