DOJ objects to Celsius plans to reopen withdrawals and sell stablecoins
The Department of Justice (DOJ) has submitted an objection to Celsius’ motion to reopen withdrawals for select customers and sell its stablecoin holdings.
The DOJ is asserting that the state of Celsius’ financials are lacking transparency, and that key decisions like this should not be considered until the independent examiner report has been filed.
The move by the DOJ adds to the objections filed last week by the Texas State Securities Board, the Texas Department of Banking, and the Vermont Department of Financial Regulation. All three are opposed to Celsius selling its stablecoin holdings, asserting there’s a risk the firm could use the capital to resume operating in violation of state laws.
In a Sept. 30 filing with the Bankruptcy Court for the Southern District of New York, a U.S. Trustee for the DOJ, William Harrington outlined an objection to Celsius opening up withdrawals to its "custody" and "withhold" customers, citing a lack of transparency over the firm’s financials.
Harrington argues in the filing that such withdrawals should not be opened up until the independent examiner report on Celsius business operations has been completed.
The DOJ has also opposed a potential stablecoin sell off, highlighting similar concerns held by Texas and Vermont regulators that Celsius’ motion doesn’t concretely outline “what impact such a distribution or sale would have” on the business moving forward.
“Second, the Stablecoin Motion seeks to liquidate stablecoins held by the Debtors without providing information regarding ownership, segregation, or the impact of such sale on later distributions to creditors who may have stablecoins on deposit with the Debtors,” the filing reads.
According to Harrington, the “United States Trustee
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