Celsius Stablecoin Sale Proposal Withheld by Securities Regulators

Celsius Stablecoin Sale Proposal Withheld by Securities Regulators
  • The Celsius stablecoin sale plan is oppose by Texas and Vermont regulators.
  • A hearing on the issue is schedule for October 6.

The Texas State Securities Board and the Vermont Department of Financial Regulation filed objections to Celsius’s intention to dispose of its stablecoin assets to bolster its finances in the context of the ongoing bankruptcy proceedings on September 29.

Objections to Celsius

A Vermont lawyer stated that Celsius can use the proceeds to resume potential legal activities. They object on the basis that the Celsius request does not detail how the firm would use the fund, generating the risk that the firm will resume operating in violation of state law. 

According to the Texas lawsuit, Celsius failed to provide adequate facts in their application to sell the stablecoin assets.

Texas filing states that 

“The Debtors fail to disclose in the Motion how much stablecoin will sold, and how the monetization of the stablecoin ultimately benefits the bankruptcy estate and the many consumer creditors of the Debtors.” 

Celsius petitioned the court for permission to sell stablecoin holdings in the middle of this month. Disclosing that the proceeds would be around $23 million. Initially said that it contains eleven different types of stablecoins but did not specify the tokens. A hearing on the issue is schedule for October 6.

The objections of the regulators are part of a shared chorus in the Chapter 11 case, which began in July of this year. Parties including state securities regulators and the U.S. Trustee has often noted the bankrupt firm’s lack of transparency. So the court has appoint an outside examiner to produce a third-party report on the firm’s financials. 

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