The insolvent cryptocurrency lender Celsius Network is preparing to present a motion that would give users one more month to submit their claims. The cryptocurrency community has begun to lose patience as they observe that Celsius’ legal costs have continued to mount and are depleting the lender’s inheritance. Celsius specified in a tweet on December 29 that it would look to spread out the prevailing claim time limit from January 3 to early February.
The
deadline of January 3 will be postponed until at least the bankruptcy court’s hearing on the motion on January 10, according to Celsius. Celsius, a bankrupt
cryptocurrency lender, will submit a petition asking for an additional month to be added to the deadline for consumers to submit claims in the ongoing bankruptcy proceedings.
Celsius said late on Wednesday that it will be requesting an extension of the bar date, or the deadline to make a claim, from January 3, 2023, to early February in a motion that will be submitted later this week. The claims
process enables creditors who feel they are entitled to payment to submit claims throughout the bankruptcy process. By December 29th,
creditors of Celsius had filed over 17,200 claims.
Although Celsius’ executive costs have sustained to rise since its first bankruptcy filing in July, creditors seem aggravated with the situation. According to a Financial Times article from December 27, the fees charged by bankers, attorneys, and other advisers in the bankruptcy case have already topped $53 million. For example, a fee statement courted December 15 from one of the law firms on behalf of Celsius, Kirkland & Ellis, asked for a
fee of approximately $9 million for services completed in September and October.
According to the company, the additional time is required to provide account holders enough time to submit any required evidence of a claim. The current claims deadline is set for January 10, 2023, and the corporation noted that the motion will be heard by the bankruptcy
court on that day. As of right now, more than 17,200 claims have been made by Celsius’ creditors, who feel they are entitled to their money back, according to the company’s claims agent Stretto.
The bankruptcy judge overseeing the Celsius case in the United States ordered the defunct cryptocurrency lender to release almost $44
million in cryptocurrencies to users of its Custody and Withhold accounts earlier this month. Since they never touched the
company’s lending service that pays interest, these accounts effectively served as cryptocurrency wallets.
After it was recently revealed that counsel and other advisers in the Celsius case had also sought
nearly $53 million in legal fees for their services in just four months since the firm filed for bankruptcy, a potential extension of the deadline for Celsius’ customers to submit their claims is likely to enrage many of the firm’s clients.
From July through October, one of these law firms, Kirkland & Ellis, billed approximately $20 million for its services, followed by White & Case LLP, which represents the committee of unsecured creditors, with a $10.2 million cost
Alvarez & Marsal North America LLC and M3 Advisory Partners LLP, who claimed $6.5 million and $4 million for their efforts, respectively, are two other prominent advisors in the Celsius case. Founder of the
global investment platform BnkToTheFuture, Simon Dixon, and a vocal participant in the Celsius bankruptcy proceedings noted in a tweet on December 23 that by the time customers can get their money back from Celsius, they should only expect to receive about half of what they invested.
Designated by Judge Martin Glenn, and fellow judge Christopher Sontchi to be a fee examiner on October 20 at the request of Celsius, the U.S. trustee, and the unsafe creditors’ committee. He must negotiate over and approve the
charges decided upon by the advocates and other experts involved in the case. The estate of Celsius is also used to pay the fee examiner, whose most recent fee statement was presented on December 21 and asks for slightly under $20,000 for work completed.
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