Troubled Crypto Lender Celsius Network Is Paying $3M in Legal Fees

In July 2022, crypto lender Celsius Network filed for Chapter 11 bankruptcy. Since then, it has been working with lawyers to make some in-court settlements with the bankruptcy. As per the latest development, the embattled crypto lender Celsius has incurred more than $3 million in legal fees. Also, as per the document filed last Friday, law firm Kirkland and Ellis has charged Celsius $2.6 million in fees between July 13 and July 31. The same filing also mentions another legal representative, Akin Gump charging the crypto lender $750,000.

This clearly shows that the legal settlement procedure is costing a bomb to the troubled crypto lender. Celsius’s troubles started when it paused the withdrawals and deposits to its platform in June.

Further investigation into Celsius’ finances shows greater difficulties. Reports have revealed financial difficulties with more than $2.8 million in crypto liabilities. As per the law firm Kirkland and Ellis, Celsius Network could be nearly $40 million in the red by October.

Back in September, Celsius faced the accusation of running a Ponzi scheme by the Vermont Department of Financial Regulation. In the latest legal filing, Celsius has disclosed the names and trading history of its platform’s users. These events have seen the troubled crypto lender losing much of its senior leadership.

Celsius on Users Withdrawals

In an additional development, Celsius Network was ordered in court to provide further evidence for freezing users’ accounts in June. One of the United States Federal prosecutors said that Celsius had trapped most of its users’ savings on the platform.

Celsius said that it has nearly 100,000 customers with assets of more than $5.5 billion. Furthermore, the troubled crypto lender defended its position saying:

“The assets which are locked in these filings are not supported by any stakeholder or “it may not go as far as some custody programs and withheld account holders. Similar kinds of security schemes can be seen in Britain and in the European Union (EU). “We are cooperating with all regulatory inquiries, and regulators are key stakeholders in our reorganization. We are not commenting as to the specific details of any inquiries.”

There have been recent reports of top Celsius executives withdrawing massive sums of money before pausing the withdrawals. These withdrawals by the top executives are to the tune of $50 million and more.