Debtors for crypto lender Celsius Network have the authority to sell coupons for mining firm Bitmain coupons worth roughly $7.4 million following a ruling from a bankruptcy judge.
In a Feb. 16 court filing, United States Bankruptcy Judge Martin Glenn said it was in the “best interests of the Debtors’ estates, their creditors, and other parties” to allow Celsius debtors to sell their Bitmain coupons. The judge’s ruling does not require the debtors to liquidate the holdings in question, but they would need the consent of the committee of unsecured creditors.
Christopher Ferraro, interim chief executive officer of Celsius, claimed in a Feb. 9 declaration that the debtors expected to sell the Bitmain coupons for roughly $7.4 million. According to the interim CEO, the coupons allowed interested parties to buy Bitmain mining rigs with a 10% to 30% discount on future purchases.
“While $7.4 million is a significant discount from the Bitmain Coupons’ nearly $37 million face-value, the Debtors believe that such a price is commensurate with the market and preferable to the Bitmain Coupons expiring worthless in the Debtors’ possession,” said Ferraro at the time. “Based on the Debtors’ marketing efforts for the sale of similar assets, the Debtors anticipate that selling the Bitmain Coupons at a significant discount to their face-value is required.”
Judge Glenn’s ruling followed debtors for the crypto lending firm presenting a restructuring plan on Feb. 15, in which Celsius chose NovaWulf Digital Management as a sponsor. The proposed plan had NovaWulf offering a direct cash contribution of between $45 million and 55 million to the new restructured company.
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Bankruptcy proceedings for major firms affected during the 2022 market crash are underway across courts in the United States. Crypto exchange FTX — facing scrutiny in bankruptcy court as well as being at the center of a criminal case in federal court — recently issued subpoenas to company insiders, including former CEO Sam Bankman-Fried.