Failed crypto lender Celsius Network kicked-off a bankruptcy trial over its plan to restart as a user-owned Bitcoin miner, telling a judge it wants to repay customers whose funds have been frozen on the platform since June 2022 a portion of what they’re owed by year’s end, Bloomberg News reported. Celsius lawyer Christopher S. Koenig said yesterday during a New York bankruptcy hearing that the new company slated to emerge from chapter 11 will be seeded with $450 million in capital and financial backing from a group of companies picked to manage the mining business, a consortium named Fahrenheit LLC that’s led by investment firm Arrington Capital. “Fahrenheit believes in the business,” Koenig said. “They are putting their money where their mouth is.” Judge Martin Glenn is considering whether to approve Celsius’s plan, which is being challenged by some customers whose funds have been locked on the platform. An affiliate of Lantern Ventures that says its owed about $82 million also opposes the plan, arguing Celsius’s advisers have overvalued the new business. The new venture must also be cleared by securities regulators. But if Celsius’s plan is approved, it would mark the first time a failed crypto platform would be reborn in chapter 11 after a string of insolvencies rocked the industry last year. The business could liquidate if the new company fails, an outcome that likely would result in Celsius customers getting repaid less, according to court documents.
