Bankrupt cryptocurrency lending company Celsius’ recovery plan has hit a road block with the US Securities and Exchange Commission.
Coindesk reported on Monday that the SEC wants more information about the bankrupt crypto lender’s assets, citing a source familiar with the matter.
A continuous exchange of information concerning the assets held by the Celsius estate is underway, involving the SEC, the Celsius Creditors Committee, and Fahrenheit, according to the source.
Fahrenheit, an investment vehicle that emerged victorious in a bidding competition earlier this year, aims to issue shares for a new crypto business built upon Celsius’ remaining assets.
“My understanding is that the SEC asked for more information to make a determination,” the source said. “The way I’m interpreting it is the SEC is telling the committee what they want to see for various parts of the business, and now the committee has to decide what they’re going to do with that information.”
The complete details of Fahrenheit’s staking operation may unfold gradually over time, Yuliya Guseva, a professor at Rutgers Law School, told Bloomberg.
“As every lawyer knows by now, crypto asset classifications are a thorny issue,” she said in an email interview. “To conclude, the successor company will need to tread very carefully because we may expect additional and considerable regulatory scrutiny, particularly from the SEC.”
In July 2022, Celsius initiated Chapter 11 bankruptcy proceedings after the disclosure of a $2 billion deficit in its balance sheet.
Fahrenheit, the investment vehicle comprising Arrington Capital, U.S. Bitcoin Corp., and Proof Group, received approval for its Celsius reorganization plan from a bankruptcy court earlier this month.
Fahrenheit’s haltedRead more on cryptonews.com