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    Home » Crypto News » DOJ Seeks to Block Celsius Motion to Reopen Withdrawals

    DOJ Seeks to Block Celsius Motion to Reopen Withdrawals

    Author: Anthonia Isichei

    Last Updated Oct 2, 2022 @ 09:00

    The US authorities sought more information to assess what would be the impact of the move.

    The Department of Justice (DOJ) is objecting to a motion by troubled cryptocurrency lender Celsius, seeking to reopen withdrawals for selected customers.

    Since Celsius halted withdrawals in June, the company has filed for Chapter 11 bankruptcy, while the CEO recently resigned from his position.

    • A United States Trustee for the DOJ, William Harrington, on Friday (September 30, 2022), filed an objection, asking the bankruptcy court to deny Celsius’ motions to reopen withdrawals for certain creditors and sell its stablecoin holdings.
    • As previously reported by CryptoPotato, the firm filed for the resumption of withdrawals for customers whose assets are held in its Custody Program and Withhold Account.
    • The US trustee described Celsius’ motions as “premature,” stating that the company is looking to “impulsively distribute funds” without a comprehensive knowledge of its crypto holding, the relationship between the company’s balance sheet, and crypto deposited by various creditors.
    • Furthermore, the filing argued that the lender is seeking to liquidate its stablecoin holdings without providing robust information concerning “ownership, segregation, or the impact of such sale on later distributions to creditors who may have stablecoins on deposit with the Debtors.”
    • An excerpt from the filing said:

    “Any distribution or sale at this juncture could inadvertently impact or limit distributions to other creditors in this case. The interested parties, the United States Trustee, and the Court require additional information to assess what impact such a distribution or sale would have.”

    • The US trustee also said that a detailed examiner’s report should be submitted before any distribution or sale occurs. On September 29, Shelby Pillay was appointed an examiner. Two days before, Alex Mashinsky resigned as Celsius CEO.
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    You Might Also Like:

    • Texas
      Texas Regulators Object to Celsius Stablecoin Sale Proposal
    • Vermont_Celsius
      Celsius Files to Resume Withdrawals for Select Customers
    • Washington_State
      Washington State Hops on Celsius Network's Bankruptcy Case
    Tags: Celsius United States
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    About The Author

    Anthonia Isichei
    More posts by this author

    Anthonia is a fintech writer who has been involved in the crypto space since 2017 covering developments across regulations, adoption, and several other aspects of the Industry. When not neck-deep in the crypto news cycle, Anthonia spends her free time globetrotting and playing video games.

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