Amid the regulatory crackdown in the United States, the bankrupt crypto lender Celsius has announced that all of its customers’ “altcoins” will be converted to bitcoin (BTC) and ethereum (ETH). Over $215 million worth of coins such as CEL, ADA, LINK, LTC, and others will be sold beginning on July 1, 2023.
Celsius Plans to Convert 15 Different Tokens to Bitcoin and Ethereum
In mid-February 2023, Celsius announced it would be acquired by Novawulf Digital Management to execute the reorganization plan. The firm filed its plan on June 15, and as per the latest revisions, customers who possess “altcoins” will have their balances converted to BTC and ETH on July 1. The only accounts exempted from this conversion are the “custody and withhold accounts.”
“Celsius will be selling all altcoins from all customers (except custody and withhold accounts) starting July 1st and will be converting them into bitcoin and ethereum,” the official Twitter account wrote. The coins included in the transition will be CEL, MATIC, ADA, LINK, LTC, DOT, BCH, AAVE, UNI, XLM, SOL, EOS, FIT, SRM, and BNB. Some of these tokens have been classified as securities by the U.S. Securities and Exchange Commission (SEC) in specific lawsuits.
The sale will contribute more than $215 million worth of these tokens to the current selling pressure the market is already experiencing. However, the distribution among 15 different crypto assets will moderate the impact of the sales. The largest sales will involve $70 million of Celsius’s native token, CEL, and around $52 million of MATIC.
Similar to FTX’s FTT token, CEL doesn’t have much to offer these days following Celsius’ bankruptcy. Over the past year, CEL has experienced an 80.8% decrease in value, with a 51.5% decline over the past 30 days. This week marks the one-year anniversary since Celsius suspended withdrawals and subsequently filed for bankruptcy protection.
Of course, the plan to convert the altcoins to BTC and ETH must be approved by the bankruptcy court. David Adler, an attorney at McCarter & English who represents a group of borrowers in the case, said his group will oppose the plan. Adler tweeted, “This proposed treatment violates every consumer lending law out there.”
What are your thoughts on Celsius’ decision to convert altcoins to bitcoin and ethereum, and how do you think it will impact the crypto market? Share your thoughts and opinions about this subject in the comments section below.