Celsius Network Looks to Return Customer Funds, Reversing CEL Crypto Losses

One of the most widely watched stories in the cryptocurrency industry this year has been the story of The Celsius Network (CEL-USD) and its struggle with insolvency. It's a story that, like the 2008 financial crisis, warns of the risks of excessive leverage but is adjusted for the blockchain era. The company's refusal to sell off what is left and shut down operations is another fascinating aspect of the narrative.

By submitting a request to restart withdrawals, Celsius is taking another step toward a complete recovery today. The mostly struggling CEL cryptocurrency is continuing its recent recovery in reaction to the news by making some substantial gains.

The market was not gradually absorbed by the crypto winter. It was a flash freeze instead. Nobody was prepared, particularly the multitude of cryptocurrency investment firms that filed for bankruptcy only days after the market fall. These businesses, including Celsius, have obtained sizable loans from a number of DeFi lenders, numbering in the dozens or perhaps hundreds. They consistently missed margin calls as prices fell. Then, they each incurred debts totaling hundreds of millions of dollars.

Just after the crash started, Celsius gained notoriety for being one of the first platforms to prevent users from withdrawing their money. Investors did not at all agree with the decision, despite the fact that the action was said to be intended to safeguard consumers. Many claim that it caused more damage than benefit. Many investors were forced to watch their assets lose value rather than completely exiting them.

The Celsius Network ultimately managed to avoid bankruptcy until July, but only after paying back some of its biggest lenders. The business is not dissolving quietly. As Celsius crosses a milestone today, it seems that the company's plan is working.

Celsius Network: Filing a withdrawal increases CEL cryptocurrency

The Celsius Network unveiled a strategy in August to guide it through Chapter 11 bankruptcy. In essence, Celsius wants to utilize its subsidiary for crypto mining to pay off debt and become profitable again.

Even if this choice may be debatable, Celsius just received a presiding judge's blessing and is preparing to expand operations. According to today's news, Celsius is increasing the stakes by making user cash accessible. The ailing CEL cryptocurrency is benefiting greatly as a consequence.

The Celsius Network's third bankruptcy hearing took place on Thursday. The topic of client cash being frozen on the company's platform received a lot of discussion time. Clients and Celsius disagree on who should get their money back as quickly as possible. In particular, Celsius claims that in order to be eligible for quick withdrawal rights, a user must place their cash directly into custody as opposed to staking.

It is nonetheless significant that Celsius is starting to release part of the $225 million in frozen customer cash, regardless of who qualifies and on what grounds. In reality, the business filed its first document in the case yesterday. It is now attempting to release $50 million to custodial users in a move aimed primarily at individual investors. Only accounts with assets totaling less than $7,575 are eligible to get withdrawal privileges from the firm.

This revelation has pleased investors, as seen by the CEL cryptocurrency prices. At the time of Celsius' bankruptcy filing, CEL was trading for roughly 70 cents. The cryptocurrency started to make a recovery around the end of August before plunging once again. However, a nearly 30% increase in the past day has helped push prices back up to the $1.50 level. The pump is being aided by soaring volume, which has increased by more than 120% in the last 24 hours.