Celsius Says Bitcoin Mining Key to Restructuring Efforts, Repaying Debts

blockchain.news:

Celsius Network stated that bitcoin mining is the key to the cryptocurrency lender's restructuring efforts as it received approval from a U.S. bankruptcy judge to spend $3.7 million in construction costs at a new bitcoin mining facility.

Celsius' hearing was conducted at a U.S. bankruptcy court where U.S. Bankruptcy Judge Martin Glenn also approved $1.5 million on customs and duties on imported bitcoin mining rigs for Celsius.

The crypto lender's lawyer for the hearing, Patrick Nash, made a statement to Glenn saying that bitcoin mining could provide a gateway to repay customers whose assets were frozen prior to the firm's bankruptcy filing.

«In a world where the crypto market rebounds, the mining business has the potential to be quite valuable,» Nash said.

In its efforts to tackle bankruptcy and repay customers, Celsius also said — via a slide presentation posted on the firm's bankruptcy website — that options might be provided «at the customers’ election, to recover either cash at a discount or remain ‘long’ crypto.»

The option to repay customers with less than they are owed in cash or ask them to remain as long-term crypto holders may sit in the hands of the crypto lender if it uses its bankruptcy case.

When the Chapter 11 court hearing opened on Monday, Celsius made a promise not to force customers to accept any repayment in US dollars or any other fiat currency.

On behalf of Celsius, Nash said that some users may choose to receive cash recoveries but that a “substantial majority” will wish to ride out the crypto winter by remaining “long crypto.”

However, Bloomberg reported that Celsius’ terms of service state that digital assets owned by users are “unsettled” and “not guaranteed” in the event of insolvency — meaning