By
Temitope Olatunji
February 2nd, 2024
Hopes are high that the restructuring will help Celsius regain its lost value.
Crypto lending service Celsius has reportedly hired a law firm to help in restructuring its current financial situation. Citing anonymous sources, The Wall Street Journal reported that the Celsius Network hired lawyers from Akin Gump Strauss Hauer & Feld LLP to help navigate the financial troubles the company is currently dealing with.
Celsius Hires Restructuring Attorneys
Many companies are struggling to keep their chin up as the global economy continues to deteriorate. Crypto companies, fintech firms, and more across different sectors are at a loss due to the market condition. As for Celsius, the company is considering financial restructuring to survive this troubling time. People familiar with the matter added that the crypto lender also seeks possible investments.
Earlier on Tuesday, Celsius Network said in a tweet that the team is “working as quickly as possible and will share information as and when it becomes appropriate.” The lender added that it is committed to acting in the interest of its customers.
The message was not very welcomed as several replies under the tweet expressed displeasure. Many are more concerned about when they can withdraw their funds and ask how soon they can access them. Celsius users received the shocking news about being unable to withdraw their funds on Monday. In “a memo to the Celsius Community”, the Network said it had to halt withdrawals due to “extreme market conditions.”
In addition to suspending withdrawals, the crypto company also paused Swap and transfers between accounts. The memo further declared that it was necessary to make the decision for liquidity and operations stability. Celsius told its community:
“We are working with a singular focus: to protect and preserve assets to meet our obligations to customers. Our ultimate objective is stabilizing liquidity and restoring withdrawals, Swap, and transfers between accounts as quickly as possible.”
$CEL Losses Value
The announcement to pause withdrawal affected its overall market capitalization, dropping below $1 trillion on the 13th of June. In reaction to the news, CEL fell 50% to hit a new low of $0.1855. Celsius’ native token CEL has grown over 90% from its $3 value in April. Current data shows that the crypto has gained 55.13% in the last 24 hours and trades at $0.5018.
Hopes are high that the restructuring will help Celsius regain its lost value. Already, some crypto critics are addressing it as a Ponzi scheme. With the few announcements made over the past week, many believe the crypto lender needs an intervention. In April, Celsius said only accredited investors in the US will be able to add new assets and earn rewards on the platform. Meanwhile, it takes a minimum of $200,000 income or a net worth of over $1 million to be an accredited investor.