Chapter 11 bankruptcy: Celsius withdraws ETH stake in Bancor

Chapter 11 bankruptcy: Celsius withdraws ETH stake in Bancor

By Charles Thuo - min read

Despite advice from lawyers, Celsius management has indicated that it shall postpone filing for Chapter 11 bankruptcy and instead look for ways to remain solvent. The move comes barely a week after Celsius reportedly hired restructuring lawyers.

Celsius has invited its users to demonstrate appreciation by making use of the “HODL Mode” in their accounts to effectively block outbound transfers.

Additionally, the crypto lender has once again withdrawn its Ethereum stake from Bancor’s liquidity pool to settle debts and maintain the weekly payouts that it has been issuing despite halting withdrawals, swaps, and internal transfers.

Withdrawing ETH stake in Bancor

According to reports from PeckShieldAlert, a suspicious Celsius account withdrew 12,880 ETH coins and 7,183 ETH coins were obtained from a Bancor liquidity pool.

Celsius has been reducing its ETH stake in Bancor after turning off the Transitory Loss Safeguard. Last Thursday, the crypto lender withdrew 2000 ETH from a liquidity pool on Bancor and received 1,150 ETH.

The move to withdraw ETH is aimed at using the ETH to settle some of the lender’s debts to remain solvent.

Consultants had recommended that the lender should declare bankruptcy. However, the CEO Alex Mashinsky and other executives opted to start with restricted transactions. Celsius believes a majority of its customers wish that the firm escapes bankruptcy since it is time-consuming and unpleasant.

By customers using the “HODL Mode,” attorneys and marketers will have faith in the crypto lender since there will be a show of support by the community and a feeling of security among investors.

According to a Celsius notification, all its staff, and particularly the CEO, are keen on attaining stable liquidity and performance.