Celsius Network gets permission from court to sell mined bitcoin

Celsius Network, a crypto lending firm facing financial difficulties, has got permission from a court in the US to mine and sell Bitcoin. The firm had said earlier this week that it was short of funds and had received several proposals for funding.

Lawyers of Celsius Network have said that the firm plans to increase investment in crypto mining to overcome the difficulties. The firm has changed its proposal, saying that the sale proceeds of bitcoin from mining will be kept separate from the firm’s cash management system. This can remove the apprehensions of many creditors whose assets are stuck due to the bankruptcy of the firm. However, the Department of Justice has opposed the firm’s proposal for bitcoin mining. Law firm Kirkland & Ellis estimates the firm may have funds exhausted by October.

The firm also owes about $2.8 billion in cryptocurrencies to depositors. This is more than its current holdings. Celsius Network filed for bankruptcy last month after banning user transactions. The firm’s decision to freeze transactions is being investigated by some regulators, including the Texas State Security Board. In this regard, the US Securities and Exchange Commission (SEC) had also sought information from Celsius. However, the SEC declined to comment. Joseph Borg, director of the Alabama Securities Commission, said, “I am concerned that the firm’s clients, including retail investors, may need to redeem their assets but they may. This could add to their financial difficulties.”

At the end of last year, the firm had secured funding of about $750 million. It is one of the largest firms involved in crypto lending. It offers interest to its customers depositing its cryptocurrencies and also lends cryptocurrencies to earn returns. It says bitcoin mining is critical to the restructuring efforts.

(This news has not been edited by NDTV team. It has been published directly from Syndicate feed.)

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