Things are starting to look worse for Bitcoin and altcoin lending platform Celsius Network. On Sunday, the Financial Times made surprising remarks about Celsius founder Alex Mashinsky. It is reported that Mashinsky withdrew $10 million from the crypto lending firm weeks before freezing withdrawals for its clients. Here are the details…
CEO of altcoin platform withdrew $10 million before disaster
In June, Celsius was one of the first major crypto institutions to feel the effects of the crypto crash caused by the failure of stablecoin Terra and cryptocurrency Luna. Advertisement of high returns to customers who invested their crypto funds in the company, Celsius assured customers that there were no problems as rumors of bankruptcy began to spread.
However, the platform would pause all withdrawals and freeze customer accounts a few days later. cryptocoin.com As we reported, Celsius filed for bankruptcy in July. At the time of the notification, the platform said it had around $167 million in cash on hand. Celsius owed its customers approximately $4.7 billion. Also, a spokesperson for Mashinsky claims that there is another $44 million frozen on the platform.
Documents appearing on Celsius’ bankruptcy filing
As it is known, Celsius had assured customers that the company was financially secure. A few days later, in June, it stopped withdrawals, trading and transfers due to “extreme market conditions”. Celsius filed for Chapter 11 bankruptcy shortly after that, revealing a billion-dollar deficit on its balance sheet.
Celsius is expected to submit details of Mashinsky’s proceedings to a bankruptcy court this week. It is also expected that other documents that further detail the financial situation of the company will emerge. According to the FT report, Mashinsky faces the prospect of being forced to return the $10 million he pulled from Celsius Networks. Under US law, payments made by a company within 90 days of bankruptcy are recoverable.
Latest situation on CEL price
Another person familiar with the matter said that $8 million of the withdrawn amount went to paying taxes. The rest of the $2 million was made in the form of Celsius Networks’ native token, CEL. The source also added that the shooting was pre-planned and linked to Mashinsky’s estate planning. In August, there were also allegations against Celsius’ founder that he used customers’ funds to make crazy bets.
Meanwhile, the cryptocurrency CEL is changing hands at $1.33, down 3.8 percent. The cryptocurrency has lost 7.8% in the last 7 days. The all-time high of $8.05 on June 4 is 83.5% below.
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