The crypto lending platform, Celsius Network, is undergoing a significant change as it navigates through the Chapter 11 bankruptcy process. Despite the challenges the company had faced, it recently received approval to start processing withdrawals for a select group of customers. However, the process is not as straightforward as one may think.
Celsius halted withdrawals in June 2022 and filed for bankruptcy in July of the same year, leaving creditors eagerly waiting for the chance to retrieve their funds. Last week, the US Bankruptcy Court for the Southern District gave the green light for Celsius to return funds transferred to the platform after its bankruptcy filing. This move has finally given hope to those who have been waiting for their money.
However, before eligible creditors can start the withdrawal process, they must first update their accounts with the necessary Know your customer (KYC) and Anti-money laundering (AML) data. The full list of eligible users has been published by Celsius and emphasizes the importance of this step in the withdrawal process.
It is worth noting that eligible creditors will only be able to withdraw about 94% of their eligible custody assets, with the court expected to make a decision on the remaining 6% at a later time. Celsius has also stressed that eligible users must have sufficient assets in their accounts to cover the transaction and gas fees. Those who do not have enough assets will not be permitted to withdraw their funds. It stated:
“Eligible users who do not have sufficient assets in their accounts to satisfy these fees will not be permitted to withdraw their assets.”
Celsius has provided a comprehensive update about the upcoming withdrawals, including a detailed court filing that outlines the entire withdrawal process. The 1,411-page document contains the full names of eligible users, along with the type and amount of assets they had deposited with Celsius.
In conclusion, while the Chapter 11 bankruptcy process has been a challenging time for Celsius Network, the recent approval to process withdrawals is a positive step forward. Eligible creditors can now take comfort in knowing that their funds are one step closer to being returned, albeit with some necessary updates and restrictions in place.
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