Celsius seeks the return of $2 billion in funds withdrawn by some of its users before bankruptcy

The liquidation regulator overseeing Celsius Network is asking major customers who withdrew more than $2 billion in total before the platform filed for bankruptcy to return those funds to avoid potential litigation. An oversight committee formed in the Celsius Chapter 11 case has begun contacting customers who withdrew more than $100,000 from Celsius’ platform before its bankruptcy in July 2022. Assets recovered through this process will be used to repay creditors who have not withdrawn funds from Celsius, according to letters sent by the commission to these clients. The committee said this asset recovery process would only affect about 2% of Celsius users, who collectively withdrew about 40% of the platform’s assets in the 90 days before Celsius filed for bankruptcy protection. Celsius said in its bankruptcy filing that its company had about $6 billion in assets, 1.7 million registered users and 300,000 active users with account balances of more than $100. The commission said customers who may be targets of recovery litigation will be offered "preferential rates" if they choose to settle; customers who choose not to settle could be forced to refund much higher amounts through potential litigation. (Bloomberg)