The U.S. bankruptcy court granted the motion by a group of holders of custody accounts on the Celsius Network crypto-lending platform to recover $43.87 million in digital assets. Bloomberg reports.
The corresponding petition was filed in September.
According to the court document, as of the end of August 2022 Celsius had about 58,300 users who, in aggregate, deposited for safekeeping on the platform more than $210 million.
Of them, 15,680 clients deposited assets into custody accounts totaling about $43.87 million. At the hearing, the court orally ordered the platform to return their assets.
Unlike Celsius customers using Earn or Borrow, custody-account holders retain ownership of their crypto assets. For them, the platform acted as a custodian for safekeeping. A legal assessment for Earn- or Borrow-product clients remains to be developed.
The judge did not extend the order to 22,580 clients who had transferred funds from Earn or Borrow accounts to custody accounts shortly before Celsius filed for bankruptcy. They hold assets worth $11.25 million.
The platform may claim ownership of these funds under rules governing so-called privileged transfers, with transfers under $7,500 exempt.
On June 13, the crypto lender suspended withdrawals, exchanges and transfers between accounts.
On July 14, Celsius and certain affiliated entities filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code.
In October, the court approved the firm’s asset-sale plan.
Earlier, on December 6, the firm’s management filed a motion seeking approval to sell stablecoins to bolster operating liquidity.
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