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CEL Jumps While Celsius’ Bankruptcy Protection Filing Reveals a Billion-Dollar Hole in Balance Sheet

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Last updated: June 26, 2023 06:54 EDT

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June 26, 2023 06:54 EDT

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Alex Mashinsky, Co-Founder & CEO of Celsius.
Source: a video screenshot, Stoic Finance / YouTube

More troubling news is coming out regarding Celsius (CEL), as its so-called Chapter 11 bankruptcy protection filing on July 14 has revealed a deficit of close to USD 1.2bn for the crypto lender.

According to a new document filed with the U.S. Bankruptcy Court of the Southern District of New York, Celsius holds USD 4.3bn in assets against USD 5.5bn in liabilities, representing a deficit of USD 1.2bn.

The majority of the firm’s liabilities were user deposits, which made up USD 4.72bn. On the assets side, the firm held USD 1.75bn in crypto assets and USD 170m in cash.

Notably, assets in the form of Celsius’ own CEL token were valued at USD 600m, despite the token having a total market capitalization of just USD 172m and a fully diluted market capitalization of USD 500m at press time on July 15, per CoinMarketCap.

Source: U.S. Bankruptcy Court of the Southern District of New York

Cryptonews.com has contacted Celsius Network for comment.

All this said, as of 07:30 UTC, the CEL token has jumped just over 26% for the past 24 hours and remained unchanged for the past 7 days. It is also up 6% in a month and down 87% in a year.

CEL 7-day price chart. Source: coingecko.com

Meanwhile, according to the filed document, the company’s mining operation, Celsius Mining LLC, could “over time” generate enough assets to repay some loans, as well as “generate Bitcoin that will provide revenue for the Company in the future.”

The document added that Celsius’ mining arm owns 80,850 mining rigs, out of which 43,632 are “in operation.”

“Mining is currently generating approximately 14.2 Bitcoins per day for the past seven days,” the filed document further said, adding that it is projecting that it will generate 10,118 bitcoin for 2022 as a whole.

It has previously been reported that the crypto exchange FTX walked away from a deal with Celsius after getting access to its financial statements. According to a report from The Block, people with knowledge of the matter cited a “USD 2bn hole” in Celsius’ balance sheet as the reason FTX lost interest.

Since then, Celsius has repaid some debt, including USD 78.1m worth of USD coin (USDC) to the lending protocol Aave (AAVE).

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Learn more:
– CEL Crashes as Celsius Enters New Chapter of Its Saga and It’s Restructuring
– Celsius Still in Hotspot Despite Repayments and Is ‘Likely Deeply Insolvent,’ Regulator Claims

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– Voyager Digital Files for Chapter 11, Seeks to ‘Maximize Value for All Stakeholders’
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