One of the world’s largest currency lending giants has

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Celsius Network, one of the world’s largest cryptocurrency lending companies, filed for bankruptcy in New York, according to a document, a month after freezing customer withdrawals. The company is thus joining the wave of digital asset companies that have frozen assets and entered restructuring amid strong cryptocurrency sales this year, according to Bloomberg.

Celsius said in a statement that it had initiated the procedure voluntarily to give it the opportunity “to stabilize its business and conclude a comprehensive restructuring transaction that would maximize value for all stakeholders”.

The company discontinued all withdrawals, as well as some other functions, on June 12, citing “extreme market conditions”, a measure that triggered further declines in the value of major cryptocurrencies.

Celsius recently hired law firm Kirkland & Ellis to handle the restructuring, replacing Akin Gump Strauss Hauer & Feld LLP, close friends told Bloomberg.

Celsius promised returns of over 18% to customers who wanted to borrow their cryptocurrencies. In turn, it lent these currencies to institutional investors, but was also a participant in a number of decentralized financing applications. When the stable currency TerraUSD (UST) and the related token Luna collapsed in May, Celsius hurried to withdraw its funds from Terra’s Anchor Protocol, which offered 20% returns for UST deposits. More recently, he has suffered from another major holding – a token known as staked ETH, or stETH, which is linked to the value of Ether – which has become largely illiquid.

The creditor is just one of the many companies in the sector that have suffered due to the fact that risky bets have turned against them in the current market down 20% (bear market).

Another centralized creditor, Babel, also stopped withdrawals. The lender Voyager Digital Ltd. also filed for bankruptcy, while the Three Arrows Capital fund was placed in insolvency proceedings in the British Virgin Islands, and later filed for bankruptcy.

In the last month, Celsius has repaid all – over $ 900 million – of its debt in decentralized Aave, Compound and MakerDAO applications, according to blockchain and Zapper tracker data.

In documents filed on July 6, the company also said it had reshuffled its board of directors, appointing two new members, including a restructuring expert, while giving up others.

The court case listed between $ 1 billion and $ 10 billion in assets, the same amount in liabilities and more than 100,000 creditors.