Celsius Clients File Lawsuit To Get Back $22,500,000 in Crypto Assets From Bankrupt Digital Asset Lender

A gaggle of Celsius Community custody pockets prospects is suing the bankrupt lending platform in an effort to reclaim greater than $22.5 million value of funds.

In a brand new lawsuit filed on Wednesday, particular person holders of greater than 64 accounts with Celsius say they retained the title to all of their crypto property held within the agency’s custody wallets and due to this fact are entitled to their return.

The account holders argue that Celsius can not use their funds to repay chapter money owed.

“In April 2022, the debtors [Celsius] created a self-titled ‘custody service’ the place customers entrusted their cryptocurrency to the debtors in a ‘custody pockets’ however retained title to such property…

In June 2022, the debtors froze all withdrawals of cryptocurrency from their platform. Since that date and because the petition date, the debtors haven’t honored any withdrawals from any applications, together with custody service, though the custody property – by the plain language of the debtors’ phrases of use present that title to custody property all the time stays with the consumer.”

On Thursday, Celsius filed a movement with the identical chapter courtroom searching for authority to allow sure prospects to withdraw their cryptocurrency from their custody program. A listening to on the movement is scheduled for October sixth.

Celsius Community initially filed for chapter again in mid-July, simply weeks after it halted all buyer transactions and withdrawals, blaming excessive market volatility.

The undertaking’s native token CEL briefly collapsed from round $0.90 to as little as $0.09. It has at present mounted a restoration and is altering palms for $1.41 at time of writing.

Because the chapter, the centralized finance agency has additionally been slapped with a category motion lawsuit alleging it operated as a Ponzi scheme.

Moreover, California’s Division of Monetary Safety and Innovation issued Celsius a desist and chorus order over claims that the corporate violated the native Company Code.

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