Celsius to sell crypto platform amid Mashinsky court battle

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Now-bankrupt Ponzi scheme Celsius Network has reached a deal with NovaWulf Digital Management LP to sell its crypto platform, in an ongoing bid to refund customers.

Celsius must still seek the approval of bankruptcy court, as well as the blessing of the majority of its customers, before the deal can go through. If all goes to plan, users can expect a share of their trapped crypto on the platform to be returned in bitcoin and ether.

Celsius currently has a $1.2 billion hole in its balance sheet. It’s seeking to recover hundreds of millions it claims to have lost at the hands of its founder and former chief exec, Alex Mashinsky. Celsius and its creditors have filed initial court documents against Mashinsky, alleging he mismanaged the firm, inflated native token CEL for personal gain, and made “negligent” investments before it went bankrupt in July.

Read more: FTX and Tether were closer to Celsius than anyone realized

The lengthy legal document cites billions transferred to DeFi platform KeyFi — partly owned by Mashinsky — for speculative investments. Celsius claims it lost $200 million from that move. The company also transferred $12 million to AM Ventures and $5 million to Koala LLP, two entities controlled and owned by Mashinsky.

Additionally, creditors allege that $2.8 million was transferred fraudulently by Mashinsky into his own wallet in May.

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