Cardano ($ADA) has experienced a significant drop in value following the US Securities and Exchange Commission (SEC) classification of certain digital assets as unregistered securities.
Following the recent regulatory changes, Celsius, a leading cryptocurrency lending company, has disclosed ongoing discussions with the SEC.
The company recently obtained approval in its bankruptcy proceedings to sell or convert its significant holdings in altcoins like $ADA to $BTC and $ETH, commencing as early as July 1.
Despite these developments, exciting new altcoins like $DLANCE, $ECOTERRA, and $CHMPZ exhibit promising potential, offering investors diverse opportunities in the dynamic crypto market.
Court Grants Celsius Permission to Convert Its Altcoins
Judge Martin Glenn has granted Celsius the right to take necessary actions to optimize the value of the altcoins in its possession.
As a result, investors who are owed debts by Celsius and hold altcoins can convert them into BTC and ETH starting from July 1.
Celsius, which filed for Chapter 11 bankruptcy protection in July 2022 due to its crushing debt of around $10 billion, temporarily halted withdrawals just before the bankruptcy filing.
The company engaged in discussions with the SEC to address the regulatory implications affecting its operations.
Consequently, these discussions have led to the approval of Celsius’ proposal.
According to court documents from December 2022, Celsius had control over various altcoins, including $MATIC, $ADA, $SOL, $LINK, $DOT, $LTC, and $AAVE.
However, the company’s current status with respect to these assets and the portion to be excluded from the sale remains unclear.
Nevertheless, with the approval of Judge Glenn, Celsius will soon commence reducing its altcoin holdings in favor of $BTC and $ETH.
These digital assets will then be distributed to creditors patiently waiting for almost a year to recover their funds.
However, during the ongoing bankruptcy proceedings, the company experienced a notable development.
Fahrenheit, a crypto consortium, emerged as the successful bidder tasked with overseeing the newly established entity owned by Celsius creditors.
