Celsius Network has hired restructuring attorneys to consult on its current financial challenges.
Note that four days ago, the crypto lending colossus announced that it has stopped all withdrawals due to the current market crisis. The freeze continues indefinitely while Celsius takes aggressive measures to help her case.
Celsius takes frantic measures
Sources familiar with the matter told The Wall Street Journal that the new attorneys are from the law firm Akin Gump Strauss Hauer & Feld LLP.
Additionally, he noted that the company is seeking help from its investors in addition to financial restructuring. The firm was one of the crypto lending firms offering attractive returns up to 18.63% Annual Percentage Return (APY). There were concerns about the stability of this framework, but they were never addressed at the time.
However, now that the crypto market is in free fall, it may have to reorganize its rewards system to make it more sustainable. its latest twitter communication reads,
“.@CelsiusNetwork working round the clock for our community. It’s all on deck, so there will be no Twitter space this week.”
The firm also cautioned that the so-called CEL2.0 token is not its creation, but could be a scammer looking to profit from its current crisis.
To complement its position in the market, Celsius has added 6,000 Wrapped Bitcoin (WBTC) to the DeFi platform MakerDAO, at which price it can be liquidated.
If Celsius fails in its savings operations, it may have to consider Monday’s proposal that rival platform Nexo made. The firm sent a letter to Celsius, offering to acquire all of its assets which, as it said, had strong liquidity. It could also mean taking Celsius’ 1.7 million customer base.
Meanwhile, another rival to the duo, BlockFi, faced a $943,000 million fine for improper registration of its platform. Celsius and Nexo have yet to register with US financial regulators, raising concerns if they may experience similar issues in the future.
Following the Celsius drama, SEC Chairman Gary Gensler called on investors to be wary of platforms that offer “too good to be true” returns. Even more, several senators last week introduced a crypto bill that aims to cushion investors in the event of a crypto firm going bankrupt.
Celsius Network’s native digital token CEL is still showing signs of recovery. As of reporting time, CEL was trading at $0.53, up 67.8% over the past 24 hours.
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