(Bloomberg) -- A government trustee handling the bankruptcy case for crypto lender Celsius Network is seeking the appointment of an examiner to help get additional information and clear up “confusion and anxiety.”
A representative for trustee William Harrington said in a hearing on Tuesday that they’re considering appointing an examiner to look into a slew of issues surrounding the bankrupt company. The representative, Shara Cornell, said in a filing dated Thursday that she hasn’t been able to get some additional financial information that would shed light on the crypto lender’s operations.
“There is no real understanding among customers, parties in interest, and the public as to the type or actual value of crypto held by the Debtors or where it is held,” the filing said.
An independent examiner would analyze Celsius’s business model, operations, investments and lending transactions, among other things. An examiner would also look at Celsius management’s “role in creating the Debtors’ current illiquidity,” the filing said, as well as any “irregularities.”
Celsius filed for bankruptcy on July 13. Since then, more than 300 customers sent in letters, some of them claiming they were deceived and asking for the return of their money. A lawyer for Celsius on Tuesday said that it’s received multiple offers of fresh cash to help fund its restructuring process. The firm said it will meet with an unsecured creditors’ committee next week and is working “expeditiously” on the path forward.
The trustee also said in the filing that an examiner could clear up misconceptions about the case that might exist from sources like social media.
“The addition of social media in this case has amplified the Debtors’ transparency issues because there is a lot of information on the internet, but it is not vetted or explained, thereby leaving hundreds of thousands of customers to form their own conclusions based on the missing facts in this case coupled with the information passed around as truth on the internet,” the filing said. “The result has been confusion and anxiety. An examiner can fix this.”
©2022 Bloomberg L.P.
Advertisement