Celsius Gets Acquired by Fahrenheit as Market Fever Subsides

1. Celsius will be taken over by Fahrenheit, another company named after a temperature system.
2. Customers affected by Celsius’ bankruptcy will finally get a share of the firm’s liquid assets.
3. The acquisition will also help Celsius reactivate its currently inactive mining rigs.

Bankrupt crypto lending firm Celsius has announced the selection of a proposal from Fahrenheit — another company named after a temperature measurement system — as the winning bid following a court-approved auction process. 

Read CRYPTONEWSLAND on google news

Fahrenheit, composed of US Bitcoin Corp., Arrington Capital, Proof Group, Steven Kokinos, and Ravi Kaza, will provide the necessary capital, management team, and technology to establish and operate the new company, referred to as NewCo. The implementation will occur through a Chapter 11 bankruptcy plan.

Under the plan, Celsius account holders will receive a meaningful distribution of the company’s liquid cryptocurrency on the plan’s effective date or as soon as reasonably practicable thereafter. 

The plan also includes settlements with the Custody and Withhold groups. NewCo will be a public, regulatorily compliant, reporting company responsible for managing Celsius’ illiquid assets, such as the institutional loan portfolio, mining business, and alternative investments, for the benefit of account holders. 

Account holders will own 100% of the new equity in NewCo, subject to potential dilution by the equity distributed to Fahrenheit as management fees. The new board of directors, with a majority appointed by creditors, will oversee NewCo.

Compared to the prior “stalking horse” bid that set the floor for the auction, the plan will distribute hundreds of millions of dollars of additional liquid cryptocurrency to account holders, and management fees for Fahrenheit have been reduced by a similar amount. 

The winning bid also offers opportunities for Celsius to reactivate its currently inactive mining rigs and for NewCo to develop its mining business over time.

Celsius has secured a backup bid with the Blockchain Recovery Investment Consortium, which would create a publicly traded mining business if needed. In this scenario, Celsius creditors would receive 100% of the equity interests and potentially enter a management contract with GlobalXDigital, facilitating an orderly winddown of Celsius’ remaining assets.

The next steps for Celsius include negotiating and publicly filing a plan sponsor agreement with Fahrenheit, a backup plan sponsor agreement with the Blockchain Recovery Investment Consortium, a revised Chapter 11 plan, and a disclosure statement. These filings are subject to approval by the bankruptcy court.

Read Also :

• Bankrupt Celsius Gets Approval to Sell Mined Bitcoin
• Celsius Collapse Drags Investors Down
• Celsius Customer Data Leak Surfaces in New Document
• What happened With Celsius (CEL), and How its Crypto Lending Burned Out
• Celsius Clients Gave up Legal Rights to Their BTC: US Judge