Discovering Empty Accounts, Celsius Allowing Crypto Withdrawals for Authorized Users

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Celsius, an insolvent crypto lender, has arranged additional withdrawals for some authorized deposit users in a recent announcement. However, only certain custodial assets are currently available for withdrawals, while other cryptocurrencies like bitcoin are not accessible.

Starting November 29, there will be two groups, namely Class 6A general custody rights and Class 6B revocable custody rights, which will be entitled to withdrawals. Users in these groups have until February 28 to make their withdrawals. Eligible users can withdraw 72.5% of their cryptocurrencies, less transaction fees, provided they have not participated in a previous custody settlement.

The announcement urged users to immediately remove these assets from the Celsius app and keep personal records of relevant information, given that the app would only be accessible for a limited period. However, some Celsius users have encountered difficulties despite the withdrawal option, reports on the X platform. This development is explained by the fact that around 58,300 users have assets worth around 210 million US dollars, considered by the court as “escrow property”.

Users are reporting connection errors on the platform. Some report that errors also occur after trying to reinstall the Celsius app. Additionally, some users have expressed concern that their Earn accounts are empty, further compounding the problems experienced by former users of the crypto lending platform.

Another development is that Celsius received bankruptcy court approval for its proposal to transform into a creditor-owned bitcoin mining company. This plan involves reimbursing customers with a combination of cryptoassets and shares of the newly created bitcoin mining company, which will go public. Distribution of assets is expected to begin in early 2024, subject to approval by the U.S. Securities and Exchange Commission (SEC).

Celsius and its founder and CEO, Alex Mashinsky, have been the subject of lawsuits from several agencies, including the SEC, the Federal Trade Commission (FTC), and the Commodity Futures Trading Commission (CFTC), due to practices allegedly misleading. Celsius has already reached a settlement with the FTC and agreed to pay US$4.7 billion following the bankruptcy proceedings. Mashinsky was accused of fraud; his criminal trial is scheduled for this year.

Currently, it remains unclear whether reported issues facing Celsius users will be resolved, including login difficulties and accounts showing zero balances. It remains to be determined whether these incidents are temporary or permanent and how the platform intends to manage them. Future actions and steps taken by Celsius to address these concerns still need to be clarified.

The lender's native token, CEL, is currently trading at $0.2533, representing a 5% rise in the last 24 hours. It is important to note, however, that the token has yet to recover from its decline in 2022 and has fallen more than 50% since the start of the year.