cash flow forecast that threatens catastrophic fund depletion, a New York judge allowed crypto lender Celsius Network to mint and trade Bitcoin (BTC) during its bankruptcy.
Since July 2022, Celsius Network has been in the crosshairs of US regulators after reports of insolvency appeared, risking the life savings of countless crypto investors.
On the second day of the case hearing, Chief Bankruptcy Judge Martin Glenn of the Southern District of New York granted Celsuis' request to run BTC mining and trading activities in order to restore financial stability.
However, Glenn highlighted worries about the immediate viability of BTC mining, pointing out the large upfront investments required to start up mining hardware.
The recent approval, however, is exclusively for mining and trading mined BTC. The court forbade Celsius from offering equity or debt investments in other crypto firms and required the crypto lender to disclose asset information in advance.
The decision to allow a defaulting crypto business to commence crypto mining operations derives from investor worries about the unjust outcomes reported by over 250 consumers.
Despite concerns that the company may run out of funds by October, the company's counsel maintained that investing in mining will bring profits for Celsius. The US Department of Justice and the Texas State Securities Board, who had earlier opposed Celsius' intention to engage in the BTC mining business, likewise withdrew their opposition once Celsius stated that it would only sell the mined Bitcoin for cash.
During the hearing, Celsius also revealed that have increased by 25% since the business filed the petition. The final hearing will be conducted on September 1 to finalize the plan prior to Celsius' exit and distribution of funds.
