Tuesday’s New York Times article revealed that Alex Mashinsky, CEO of crypto lender Celsius Network, has presented strategies to assist the firm rebound from its bankruptcy.
In July, Celsius filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of New York after stopping withdrawals and redemptions on its platform owing to the current bear market in cryptocurrencies.
According to the source, Mashinsky and Oren Blonstein, another Celsius executive, informed staff at a meeting on September 8 that they want to restructure the firm as a security provider.
A cryptocurrency custodian holds and safeguards digital assets on behalf of investors and charges fees for specific transaction types.
The executives mentioned that the project’s codename was “Kelvin,” after the temperature measurement unit.
Blonstein said, “If the cornerstone of our company is custody and our clients choose to bet elsewhere, exchange one asset for another, or take a loan against an asset as collateral, we should be able to charge a fee.”
During the discussion, Mashinsky mentioned many prominent global businesses, like Pepsi, that had previously declared bankruptcy but were able to recover.
Does it affect the flavor of Pepsi? Delta filed into bankruptcy. Do you no longer fly Delta since the company declared bankruptcy? “Are we destined for the trash heap of firms that were once great, almost great, or tremendous for a while but have since disappeared?” he questioned rhetorically.
Mashinsky further said that Celsius was collaborating with the Committee of Unsecured Creditors (U.C.C), a legal organization representing the company’s unsecured creditors, to develop a strategy to continue operations.
According to the article, creditors of the firm raised worry with Mashinsky’s continuing connection with Celsius and the “feasibility” of the Kelvin plan after the meeting.
Before being considered, Mashinsky’s suggested proposal to reconstruct Celsius as a custodian would need permission from the federal bankruptcy judge in charge of the company’s bankruptcy proceedings in New York, Martin Glenn.