Retail crypto lending platform Celsius Network said on Thursday that it was exploring options, including deals and restructuring its liabilities.
Earlier this month, Celsius froze withdrawals and transfers, citing “extreme” market conditions, leaving its 1.7 million customers unable to redeem their assets.
The Hoboken, New Jersey company has hired restructuring consultants from the advisory firm Alvarez & Marsal to advise on a potential bankruptcy filing, the Wall Street Journal reported last week, citing people familiar with the matter.
The digital asset market in recent months has been rocked by extreme volatility as investors dump risky assets on fears that aggressive interest rate hikes to rein in stubborn inflation could sink the the economy in a recession.
The European Union has agreed to groundbreaking rules to regulate crypto assets, EU lawmakers said on Thursday, as bitcoin’s defeat increases pressure on authorities to rein in the sector.
Cryptocurrencies have lost more than $400 billion since TerraUSD, a major stablecoin pegged to the US dollar, crashed in May. Bitcoin fell another 6% to $18,866.77 late on Thursday, leaving it more than 70% below its peak last November.
Like a bank, Celsius pooled crypto deposits from retail customers and invested them in the wholesale crypto market equivalent, including “decentralized finance,” or DeFi, sites that use blockchain technology to offer services, from loans to insurance, outside of the financial sector traditional.
