ChainCatcher reported that according to CryptoSlate, the litigation administrator of the bankrupt cryptocurrency lending company Celsius Network filed legal action against account holders who received priority transfers within 90 days before the company filed for bankruptcy. These lawsuits were filed in the United States Bankruptcy Court for the Southern District of New York against accounts with a withdrawal right risk (WPE) of more than $100,000.
The announcement follows successful settlements with more than 1,500 account holders, recovering nearly $100 million. These settlements resolved more than $500 million in priority debt and provided significant relief to eligible Celsius creditors.
During the priority period from April 14, 2022 to July 13, 2022, a large number of withdrawals caused the company to have a serious financial imbalance, and ultimately filed for bankruptcy after the priority period ended. Former Celsius CEO Alex Mashinsky and other executives are facing charges of fraud and market manipulation that led to the company's demise.