CRYPTO-BANKRUPTCY UPDATE: Celsius Network Bankruptcy Auction Concludes with Fahrenheit LLC Selected as Successful Bidder

 By Michael L. Moskowitz, Esq. & Melissa A. Guseynov, Esq.

We have previously reported on the Celsius Network (“Celsius”) chapter 11 bankruptcy case and the recent auction for the sale of its assets.  Celsius and its affiliates filed for bankruptcy on July 13, 2022, in the United States Bankruptcy Court for the Southern District of New York. 

On May 25, Celsius announced that the month-long auction had finally concluded after multiple rounds of bidding, with Fahrenheit LLC (“Fahrenheit”) selected as the successful bidder.  Fahrenheit is made up of a group of entities including U.S. Bitcoin Corp., Arrington Capital and Proof Group. 

Celsius will include the details of the sale transaction in its chapter 11 plan of reorganization, which must be filed by the end of June.  Fahrenheit will provide new management as well as the capital and technology necessary to operate Celsius as a new entity.  Account holders under Celsius’ Earn program will receive pro rata shares in cryptocurrency assets under the plan of reorganization.

Celsius also announced the selection of a backup bid from the Blockchain Recovery Investment Consortium, which proposed to convert Celsius’ business into a wholly digital asset mining operation, whereby creditors would receive all the equity in the new business.  We will continue to keep clients and colleagues up to date on the successful bidder.

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