Celsius Network takes legal action to recover funds withdrawn prior to bankruptcy

The litigation administrator for bankrupt cryptocurrency lender Celsius Network has filed legal action against account holders who have not settled debts related to priority transfers made within 90 days before the company filed for bankruptcy. The action, filed in the U.S. Bankruptcy Court for the Southern District of New York, targets those with withdrawal priority exposure (WPE) exceeding $100,000. Previously, Celsius had successfully reached settlements with more than 1,500 account holders, recovering nearly $100 million. The settlement resolves more than $500 million in priority debt and provides significant relief to eligible Celsius creditors. Mohsin Meghji, litigation administrator for Celsius, said: "Account holders who withdrew funds before Celsius' bankruptcy received unfair benefits, affecting other account holders. These people had ample opportunity to settle at preferential rates. Now, we will pursue the full value of the cryptocurrency transferred during the priority period in accordance with the provisions of the Bankruptcy Code." The large number of withdrawals during the priority period (April 14, 2022 to July 13, 2022) caused a serious financial imbalance in the company, and the company ultimately filed for bankruptcy after the priority period. (Cryptoslate)