In a vivid illustration of the complications that can result from turbulence in the fintech world, crypto lending company Celsius Network put a stop to customer withdrawals during the crypto decline earlier this summer. The company filed for bankruptcy shortly thereafter, and the approximately $210 million that was frozen has remained in limbo ever since, with account holders unable to access their funds.
As of the beginning of September, it looks like that stalemate is due to come to an end. According to a statement by Celsius, withdrawals will once again be made available to the 58,300 users whose accounts were affected.
The reopening of withdrawals comes on the heels of a petition filed by 64 such customers whose custodial accounts were abruptly made inaccessible to them. The group of disgruntled Celsius account holders have understandably expressed a great deal of frustration at their present situation, arguing that the company has intentionally and unnecessarily delayed the process of returning their funds.
“The Debtors' continued refusal to honor withdrawals of all Custody Assets has created tremendous hardship on their users,” the petitioners wrote. In legal proceedings led by this group of Celsius users in the Southern District of New York, it has been revealed that Celsius’ assets plummeted in value from $17 billion to less than the $4.7 billion it held in debt when it declared bankruptcy.