Feb 15 (Reuters) – Crypto lender Celsius Network will seek to exit bankruptcy under the guidance of asset manager NovaWulf Digital Management, which will take over the operations of a new company that will be owned by Celsius customers, the company said at a court hearing in Manhattan on Wednesday.
The proposed deal with NovaWulf should allow Celsius to exit Chapter 11 and begin returning crypto assets to customers in June, Celsius attorney Ross Kwasteniet said at Wednesday’s hearing.
Celsius selected NovaWulf’s bid out of more than 130 proposals received, saying that NovaWulf was the only finalist that intended to maintain long-term control over Celsius’ harder-to-liquidate assets, like its loan portfolio and bitcoin mining business.
Those assets would be owned by Celsius creditors and managed by NovaWulf under a profit-sharing agreement if U.S. Bankruptcy Judge Martin Glenn, who is overseeing Celsius’ Chapter 11 process, and creditors sign off on the deal.
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Crypto lenders such as Celsius boomed during the COVID-19 pandemic, drawing customers with the promise of high interest rates on their cryptocurrency deposits and the ability to borrow against their crypto assets. But many companies in the highly interconnected sector went bankrupt