The SEC objected to Celsius’ restructuring plan. The crypto world’s nightmare has expressed concern about Coinbase. Coinbase CEO Brian Armstrong and chief legal officer Paul Grewal issued a joint statement questioning the SEC’s reasoning in its objection.
SEC objects to Coinbase and Celsius deal
The United States Securities and Exchange Commission (SEC) has objected to the restructuring plan of bankrupt crypto platform Celsius Network. He cited the regulator’s own ongoing case with crypto exchange Coinbase as justification for this. The SEC filed a limited objection and reservation of rights with the U.S. Bankruptcy Court for the Southern District of New York on September 22. Here he partially objected to Celsius’s latest proposed restructuring plan. Meanwhile, the fourth revision of the bankruptcy plan on August 15 followed the first proposal in March. However, these proposals did not receive approval.
Celsius made an addition to the reconstruction plan. There, he proposed a distribution services agreement with Coinbase, which Celsius attempted to file under seal. In its objection, the SEC argued that the deal would require Coinbase to “go far beyond the services of a distribution agent.” It also claimed it would potentially provide those services in a civil lawsuit the commission filed in June. The file in question regarding crypto companies underlines the following points:
The Borrowers confirm that, despite any statements to the contrary in the Coinbase Agreements, Coinbase does not intend to provide brokerage services to the Borrowers. However, this Court should not be asked to approve an agreement where material terms are missing or inconsistent.
Crypto exchange officials have a hard time understanding the SEC’s objection!
cryptokoin.comAs you follow from , revisions to Celsius’ plan have been continuing since March. Meanwhile, Coinbase is facing an SEC lawsuit for allegedly selling unregistered securities. Coinbase CEO Brian Armstrong and chief legal officer Paul Grewal made a statement on the issue. In a post on Sept. 25, Grewal said the exchange was “proud to work with Celsius” in its efforts to return user funds. In this regard, Grewal shared the following from his X account:
Coinbase is proud to partner with Celsius to distribute crypto back to its customers. I wonder why the SEC objects to a reliable US public company assuming this role? We look forward to addressing this matter with the bankruptcy court and playing our important role in making Celsius customers whole.
Coinbase is proud to engage with Celsius to distribute crypto back to its customers. I wonder, why would the SEC object to a trusted US public company taking on this role? We look forward to addressing this with the bankruptcy court and undertaking our important role to make… https://t.co/5i1aJDiPXp
— paulgrewal.eth (@iampaulgrewal) September 25, 2023
Celsiusn court process continues
The bankruptcy court filing comes after Celsius announced a deal with Core Scientific in which the crypto mining firm agreed to sell a mining data center to Celsius for $14 million in cash and resolve any existing legislation between the two firms. Celsius has fallen behind on its payments since filing for bankruptcy in July 2022, according to Core Scientific.
In August, the bankruptcy court approved Celsius to send out digital ballots to vote on its restructuring plan in October. Meanwhile, according to the planning, the next hearing of the bankruptcy case will be on October 5. In this process, we will also see what the outcome of the SEC objection will be.
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