Your Crypto Exchange Went Bankrupt? The Best Money Moves to Make Next, According to Experts

Nattakorn Maneerat /

This crypto winter has been particularly harsh following the recent collapse of several crypto platforms which have left investors frustrated about how to recoup their assets.

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Crypto lending platforms Voyager Digital and Celsius promised eye-popping yields to their customers — that is until they both filed for bankruptcy in early July due to their exposure to the now infamous Three Arrows Capital, which itself went bankrupt after the implosion of Terra LUNA and its TerraUSD (UST) stablecoin.

Voyager provides loans, “typically in the form of a specific type of cryptocurrency, to counterparties in the cryptocurrency sector to facilitate liquidity or trade settlement and interest earned from the company’s loans is passed along to customers, who earn a “yield” on their stored cryptocurrency,” the company explained in the bankruptcy court filing.

Celsius, which had a similar model, said in its bankruptcy filing that “these chapter 11 cases will provide a “breathing spell” for the debtors to negotiate and implement a plan that will maximize the value of its business and generate meaningful recoveries to our stakeholders as quickly as possible.”

According to the court filing, Celsius has a $1.2 billion deficit on its balance sheet and owes users $4.7 billion. The company says it has $167 million in cash on hand, “which will provide ample liquidity to support certain operations during the restructuring process,” according to a statement announcing the Chapter 11 proceedings. 

The collapse of Terra and the loss of more than $50 billion in values of the Luna and UST coins over a three-day period created a…

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