According to Bloomberg, a US bankruptcy judge hearing the case against Celsius Networks has ordered the lender to return cryptocurrency worth $50 million to its customers.
Judge Martin Glenn issued the order verbally in a hearing on Wednesday. According to the report, the cryptocurrency “never touched the lender’s interest-bearing accounts to its customers.”
Although the lender owes its customers billions of dollars, the order only affects crypto worth about $44 million in September.
In September, Celsius initiated a process to return the customer funds in its custody. The company announced a deficit of nearly $1.2 billion when it filed for bankruptcy in July.
Details of the Filing and Order
The filing claims that 15,680 customers hold “Pure Custody Assets” worth approximately $44 million out of a total of 58,300 users who have deposited over $210 million in Celsius’s custody.
The order, issued verbally during a hearing on Wednesday, concerns cryptocurrency valued at around $44 million as of September. Celsius owes other users billions of dollars in cryptocurrency.
Celsius argued that its custodial account customers retain ownership of their cryptocurrency assets, unlike customers of its Earn or Borrow product. Celsius’s role was limited to that of a storage facility. Therefore, the customers, not Celsius’ estate, are the rightful owners of these funds.
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