Crypto loan platform Celsius, which announced its bankruptcy, is facing a new lawsuit filed by its customers.
The bankrupt cryptocurrency lender Celsius has faced new legal challenges as clients take action to recover their assets.
Celsius Sued Again
Celsius stopped withdrawing cryptocurrencies in June this year. The company, which sought creditor protection in the lawsuit after announcing its bankruptcy, was justified in its request, but customers disagree.
The group of 64 people with custody accounts at Celsius filed a complaint with the US Southern New York Bankruptcy Court to recover their assets.
According to court documents, creditors are trying to recover more than $22.5 million worth of crypto assets held in Celsius’ custody service. The creditor group is represented by the bankruptcy focused law firm Togut, Segal & Segal.
The plaintiff states that Celsius does not allow withdrawals from any program, including custody services. According to the complaint, this contradicts creditor terms of use, which includes a banner that says stored assets always remain with users.
According to Celsius’ terms of use, all digital assets held in the platform’s storage wallet remain with customers and are not transferred to Celsius.
In terms of use, last revised in April 2022, Celsius writes:
“Celsius will not transfer, sell, lend or re-mortgage digital assets held in its custody wallet unless instructed by you or requested by a valid court order, authorized regulatory agency, government agency, or applicable law.”
Another thing Celsius has been grappling with this year has been the lawsuit by users to get the remaining coins in the Celsius system.
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