3AC creditors identified, users concerned about Celsius claims

With the prices of the market’s large cryptocurrencies beginning a steady recovery and some already predicting the end of the cryptocurrency winter, optimists hope that the darkest days of the crisis are behind us – but both companies’ battles are bankrupt Celsius (CEL) and Three arrows capital (3AC) is far from having found a solution.

Source: Adobe / Amelia

3 AC

  • Legal documents from Singapore, removed from the Internet but still available via Wayback Machine, revealed the list of creditors in 3AC: among these, Digital Currency Groupthe broker’s operator Genesis filed a $ 1.2 billion claim.
  • Digital Currency Group reportedly told The Block that “DCG and Genesis’ balances remain strong” and that they have “no residual exposure” to 3AC and that Genesis “continues to be well capitalized”.
  • Other 3AC creditors include the cryptocurrency exchange operator Deribit, DRB Panamawhich borrowed 3AC 1,300 bitcoin (BTC) and 15,000 ether (ETH), worth a total of about $ 51 million at the time of writing.
  • The Celsius Network was also affected when it borrowed $ 75 million worth of USD-backed stack coins.
  • Other industry players on the list include Travel digitally, Coin list, Defiance Capital and FalconX. Voyager, which also filed for bankruptcy, borrowed $ 685 million from BTC and ETH. Also, according to The Block, Falcon X and CoinList have denied claims that they are in financial difficulties due to their exposure to 3AC.
  • FalconX said its balance sheet was stronger than ever, while CoinList said that “the 3AC standard does not affect user resources, only assets on our own balance sheet.” The latter added that he had “made one [tour de financement] $ 100 million Series A in October 2021 “and” have several years of ground clearance. “
  • The 3AC founders and their spouses also lodged complaints: Chen Kaili Kellyco-founder’s wife Kyle Daviesfiled a claim of about $ 66 million while co-founder Zhu Su filed a claim of 5 million. Bloomberg noted: “It is not immediately clear how the Three Arrows were structured to allow Zhu to be the creditor.”
  • No one knows where Zhu and Davies are now, but they both saw the liquidation case online, via a Zoom call, with their cameras turned off and their microphones turned off.

Celsius

  • During the bankruptcy hearing, lawyers explained that Celsius owed more than $ 5 billion to half a million creditors. The case began yesterday, with lawyers representing the company presenting a detailed document to the court on the company’s financial situation.
  • The company wants a legal reorganization, that is, an attempt to temporarily stop civil lawsuits from creditors, to give the company the necessary time to restructure its finances and finally pay off its debts.
  • Pat Nash, Celsius’s senior lawyer, effectively asked creditors to take a long-term view and wait for market prices to recover. He explained that the company’s mining arm mines 14.2 BTC a day and seeks to increase its operations.
  • According to a Financial Times reporter who covered the case, Nash reportedly said, “the vast majority of our customers will be interested in getting through this crypto winter and having the opportunity to recover their assets after a positive correction in the cryptomacro environment.”
  • Celsius’ assets do not amount to much: the company has $ 170 million in fiat currency holdings and its claims are around $ 620 million. It owns $ 720 million in mine hardware, the price of which has unfortunately largely fallen in recent months. It also has $ 450 million in “other” assets, as well as significant amounts of its own CEL token.
  • The section entitled “Key Legal Issues” contains material that may prove to be of concern to Celsius customers who are still unable to withdraw their money. It reads: “Are the cryptocurrencies in possession of Celsius real estate? What does it mean to cancel a cryptocurrency claim or pay a cryptocurrency claim in full? Are customers entitled to the return of cryptocurrencies in kind?
  • Legal experts on Twitter have argued that the company could try to prove that Celsius is not legally obliged to return the money to its Earn customers. the lawyer David Silver have writing : “Celsius claims that the cryptocurrencies in the EARN program do not belong to users (ie stop believing that it is * your * crypto). Celsius is the owner of the crypto assets. Most of the assets in Celsius’ possession came through EARN program and [font] part of the estate [de Celsius]. “

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