The post Celsius Appeals Court Ruling Against $444 Million In FTX Claims appeared first on Coinpedia Fintech News
Celsius, the defunct crypto lender, has filed an appeal against a court ruling that dismissed its claims for damages from FTX. This move comes as part of its ongoing bankruptcy process, where Celsius seeks to recover significant funds while dealing with past missteps.
The Claims Against FTX
Celsius originally sought $2 billion, blaming FTX for making false statements that allegedly worsened its financial problems. Later, the claim was revised to $444 million, focusing on “preferential transfers” arguing that certain transactions unfairly benefited specific creditors.
In December, Judge John Dorsey dismissed both claims in December, saying Celsius failed to provide enough proof. He also criticized the company for improperly filing changes to its claims in July 2024 without seeking permission.
The court ruled these changes were unrelated to the original claims and would disrupt FTX’s restructuring.
Paying Back Creditors
Despite legal challenges, Celsius has worked to repay its creditors. In August, it returned $2.53 billion to over 250,000 creditors, covering around two-thirds of the claims. In November, it announced another $127 million payout from its recovery funds.
These efforts briefly boosted the value of Celsius’s native token (CEL), which surged 350% to $0.56 in September. However, the price dropped to $0.1960.
Legal Troubles for the Founder
Adding to Celsius’s challenges, its founder, Alex Mashinsky, pleaded guilty last month to fraud and manipulation of the CEL token. He faces a potential 20-year prison sentence, with sentencing scheduled for April 2025.
What’s Next for Celsius?
Celsius’s appeal aims to overturn the court’s dismissal of its claims against FTX. While it continues to navigate bankruptcy proceedings, the case highlights the risks and complexities in the crypto industry.
For now, Celsius faces an uphill battle to recover its reputation and secure fair outcomes for its creditors.