Celsius Custody Clients Join Lawyers to Recover $180M in Frozen Assets

According to Coindesk, clients who hold cryptocurrencies in escrow accounts at Celsius have joined forces to hire lawyers from Togut, Segal & Segal to recover the frozen assets. These clients are claiming about 180 million in claims. USD, which only accounts for 4% of the total assets locked in Celsius.

Since Celsius’ first bankruptcy hearing, the escrow account task force has grown to more than 300 members and raised nearly $100,000 as a retention money for its attorneys.

A task force is a group of people with a common interest in a case who are willing to pay out of their own pocket a lawyer to represent them. David Little, one of the group’s organizers, said: “Everyone was signing a pledge to pay $93. I have no doubt we’ll be successful and we’ve grown our group from a few people to nearly 400 in a few days. , and raised $100,000 with a group of capable strangers.”

Unlike clients who deposit funds with Celsius’ high-yield Earn product, custodial clients do not charge interest, and they store cryptocurrencies through the Celsius platform. According to the company’s terms of service, these clients also differ in that ownership of the custodial client’s assets remains with the wallet holder.

Celsius, currently undergoing bankruptcy hearings, froze customer accounts in June due to a $1.2 billion hole in its balance sheet, sparking competition among different types of claimants including ordinary retail customers, major institutional creditors and equity holders .

Escrow wallet holders were the first to form an ad hoc panel in the case, and bankruptcy claims specialist 507 Capital founder Thomas Braziel told Coindesk that these creditors are concerned that Celsius’ law firm Kirkland & Ellis may just be telling them they want to hear content without doing much actual support. For example, Kirkland could have filed a motion to return the funds in fiat currency, but the firm said they would file a “declarative judgment” that would “let the court decide what to do instead of a motion to return the assets.”

Braziel said in an interview: “The rumor is that it was a verbal commitment to the claimant. It’s not 100% clear whether the assets are in escrow, Celsius says they do it for you, but the terms and conditions are very vague.” .

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/celsius-custody-clients-join-lawyers-to-recover-180m-in-frozen-assets/
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