Celsius To Sell Self-Custody Platform For 78% Loss, But It Gets Worse

Celsius Network has gone public with another development that adds to the troubles of the bankrupt crypto lender. This time around, the bankrupt crypto firm is selling one of its core platforms, but at a significant loss, with the proceeds not even going to creditors once again.

Celsius Network Agrees To Sell GK8

The GK8 platform is one of the Celsius Network’s highest purchases during its operational time. Back in 2021, the crypto lender purchased GK8, a self-custody platform, for a total of $115 million. This was at a time when the platform had not shown any signs of trouble and business was still booming.

However, less than a year after buying the platform, the crypto lender filed for bankruptcy, with a hole in its balance sheet running into billions of dollars. Now, a year later, the crypto lender is still deep in the throes of bankruptcy proceedings and has agreed to sell the GK8 platform.

In a court filing submitted on July 17, Celsius reveals that it has now reached a settlement with interested buyers for the self-custody platform. The downside, however, is that GK8 is being sold for $25 million, accounting for a 78% loss compared to the price it was purchased at.

CEL price sitting at $0.16 | Source: CELUSD on TradingView.com

Proceeds Not Going To Creditors

Despite the GK8 platform selling for a significant sum, the proceeds are still not going to creditors who have been waiting for refunds for over a year. Instead, the filing shows that the majority of the proceeds will be going toward paying off legal fees.

According to Celsius, a total of $24 million will be allocated toward servicing the legal expenses that the company incurs during the course of its bankruptcy proceedings. The remaining $1 million will then go toward the Series B holders.

The filing states:

In light of the fact that the primary purpose of the settlement is to reduce administrative costs, the debtors agreed to and remain supportive of the proposed allocation, which provides the initial consenting Series B holders with reciprocal benefits.

Self-custody platform GK8 is not the only thing that the crypto lender is selling as it has also moved on to selling other assets. According to recent reports, Celsius is now selling crypto-assets worth $63 million. These assets are now being sent to exchanges to be sold to facilitate repayments.

As for its native token, CEL is down over 97% from its all-time high of $7.99. It is now trading at $0.16, up 2.35% in the last day.