Celsius | Crypto

Tether’s $299.5 million Celsius settlement could ignite a debate over stablecoin accountability and the legal risks facing issuers in future crypto bankruptcies. Stablecoin issuer Tether has agreed to pay $299.5 million to the Celsius Network bankruptcy estate, resolving claims tied to the crypto lender’s 2022 collapse and potentially opening a new chapter in the debate over stablecoin liability. The Blockchain Recovery Investment Consortium (BRIC) — a joint venture between asset manager VanEck and GXD Labs, an affiliate of Atlas Grove Partners — announced the settlement on Tuesday. The recovery concludes a years-long dispute over Bitcoin (BTC) collateral transfers and liquidations that preceded Celsius’s high-profile bankruptcy in July 2022. BRIC was formed in early 2023 to help maximize creditor recoveries from bankrupt digital-asset platforms. It was appointed asset recovery manager and litigation administrator by the Celsius Debtors and the Unsecured Creditors’ Committee in January 2024, after the company...

Bitcoin lending is making a quiet comeback with tighter controls, but volatility still threatens sudden liquidations. Bitcoin lenders are betting that tighter controls and clearer risk management can rebuild trust in a sector still haunted by the collapse of predecessors Celsius and BlockFi. Major Bitcoin lenders of the previous cycle imploded after turning user deposits into undercollateralized loans. When Bitcoin (BTC) prices fell and liquidity dried up, billions in customer funds were frozen or gone. But those implosions don’t prove that crypto-backed loans are doomed by design. The failures were largely the result of poor risk management rather than the model itself. Some platforms are now taking the right steps, such as overcollateralization, while enforcing stricter liquidation thresholds, according to Alice Liu, head of research at CoinMarketCap. Read more

Alex Mashinsky, the former CEO of Celsius, has agreed to surrender all rights to assets tied to the collapsed crypto lender. According to newly filed court documents, Mashinsky and entities associated with him, including AM Ventures Holdings Inc., Koala1 LLC, and Koala3 LLC, will be excluded from any future distributions under the Celsius bankruptcy plan. The […] The post Alex Mashinsky forfeits rights to Celsius assets amid ongoing bankruptcy process appeared first on CryptoSlate.