By Brent Addleman | The Center Square
An unlicensed cryptocurrency company operating in Vermont has filed for bankruptcy, state officials said.
Celsius, which offers interest-bearing crypto accounts, has filed Chapter 11 bankruptcy, the Department of Financial Regulation announced. The company on July 12 said it was halting withdrawals, swaps, and transfers between customers.
The department reports the company, along with several affiliate companies, entered voluntary Chapter 11 bankruptcy proceedings on July 13 in the U.S. Bankruptcy Court for the Southern District of New York.
According to the release, Chapter 11 allows insolvent companies to reconfigure their financial obligations whether through a sale, reorganization, or another method.
The company’s first hearing is scheduled for 2 p.m. Monday.
In court records, the company lists eight debtors, including Celsius Network LLC; Celsius Network Inc.; Celsius Network Limited; Celsius KeyFi LLC; Celsius Mining LLC; Celsius Network Lending LLC; Celsius Lending LLC; and Celsius US Holding LLC.
According to the release, a small number of cryptocurrency companies have filed bankruptcy and are proceeding through the bankruptcy court system. The department said there “is little law on how digital assets will be treated” in bankruptcy court, and it is unknown if account holders will be able to “sell or get back their cryptocurrency assets.”
According to the release, the department will monitor the bankruptcy proceedings and urges investors with the company to consult with their legal counsel about the situation.
Vermont residents with questions, or wishing to file a complaint, can do so by visiting the department’s website.