US Bankruptcy Judge Rules on Celsius Asset Ownership

US Bankruptcy Judge's Ruling

A significant decision was made regarding the ownership of assets in the Celsius Earn Accounts. The US Bankruptcy Judge, Martin Glenn, ruled that these assets belong to Celsius, not the account holders. This ruling affects the priority of customer compensation during the bankruptcy process.

Impact on Celsius Customers

The decision highlights that Celsius customers will have a lower priority when compensating for losses. While creditors will be heard during the claims resolution process, the ruling places Celsius as the owner of the assets, which includes approximately 600,000 accounts and $4.2 billion in assets at the time of its Chapter 11 filing.

Legal Interpretation of Asset Ownership

Judge Glenn emphasized that the ownership issue is a matter of contract law. According to the terms of use, Celsius had all rights and title to the eligible digital assets, including ownership rights. The judge described these terms as "unambiguous."

Considerations for Creditors

Despite the ruling, plans are in place to address the concerns of unsecured creditors during the claims resolution process. This indicates a structured approach to resolving claims while acknowledging the challenges faced by creditors.

Conclusion

This ruling by Judge Glenn underscores the importance of understanding account terms and conditions, especially concerning asset ownership in digital financial platforms. The decision sets a precedent in the handling of similar bankruptcy cases within the cryptocurrency industry.