Not only has Celsius screwed all their customers over,
but now they want to screw us some more.
And on top of that,
lawyers are filling their pockets with real money and hot CEL tokens.
Find out exactly what's happening
and whether you're going to be able to get your money back or not
if you were on Celsius.
Let's get it!
Welcome to BitBoy Crypto!
My name is Ben.
Today, we're going to be talking about Celsius
and whether you're going to get your money back
or whether I'm going to get my money back.
So, guys, let's start this back in the beginning.
So, if you go back here to June 13, 2022,
crypto lending service Celsius pauses withdrawals,
citing 'extreme market conditions.'
Is that really what it was?
Extreme market conditions?
Or was it you didn't have all the money you said you're going to have?
MacGruber--
do you guys remember that Saturday Night Live skit MacGruber?
There he is.
He's going to make a crypto lending service out of a hairpin.
Crypto lending service Celsius announced early Monday it would pause withdrawals,
citing "extreme market conditions."
This was a fun day.
"We are working with a singular focus:
to protect and preserve assets to meet our obligations to customers.
Our ultimate objective is stabilizing liquidity and restoring withdrawals,
Swap, and transfers between accounts as quickly as possible."
So, interesting, right?
We go back to June 13.
And, "Hey, getting your money back is going to be possible.
You're going to be able to transfer between accounts."
Well, let me tell you what happened to us.
What happened to us?
We had about $3 million on Celsius.
We had about I think a $2 million loan
that we had just collateralized some of our crypto over.
And we had all the money to pay the loan.
It was just in altcoins and Bitcoin,
but we had a big loan on Ethereum.
We couldn't pay off our Ethereum loan with crypto that was in our account.
What Celsius actually wanted, believe it or not,
they wanted us to send in new money into their exchange to pay off our loan.
Absolutely not.
We ended up getting liquidated on the loan.
We lost a good bit.
But, hey, we've lost all the money that was on Celsius so far.
But let's check this out here.
Celsius files for Chapter 11 bankruptcy.
The crypto lender said it has $167 million in cash, this is from July 13, on hand
and will continue to freeze customer withdrawals.
This is an important number--- $167 million in cash.
So, what is a Chapter 11?
I guess everybody needs to start here, right?
So, Chapter 11 is a form of bankruptcy that involves a reorganization,
you may have heard the term "reorg" thrown around quite a bit,
of a debtor's business affairs, debts and assets.
It's also referred to as a "reorganization" bankruptcy.
Chapter 11 bankruptcy allows a company to stay in business
and restructure its obligations.
If a company filing for Chapter 11 opts to propose a reorganization plan,
it must be in the best interest of the creditors.
If the debtor does not put forth a plan, the creditors may propose one instead.
Many major corporations, including General Motors and K-Mart,
have used Chapter 11 bankruptcies as an opportunity to restructure their debts
while continuing to do business.
So, a lot of these companies have filed Chapter 11.
Well, they're still in business today and they reorganized
and, you know, they're able to continue on.
But what's interesting about this is
K-Mart nor General Motors mismanaged customers funds illegally and fraudulently.
Quite a difference here when you think about that.
Now, are there advantages to filing Chapter 11?
The biggest advantage is that the entity, usually a business,
can continue operations while going through the reorganization process.
This allows it to generate cash flow that can aid in the repayment process.
Are there disadvantages?
Chapter 11 bankruptcy is the most complex of all bankruptcy types.
It is also usually the most expensive.
Remember, they only had $167 million.
For a company that is struggling to the point where it is considering filing for bankruptcy,
the legal costs alone might be onerous.
December 17, 2022,
Celsius' lawyers seek $52.8 million litigation fees!
$52.8 million!
$167 million cash on hand.
"Hey, I know.
Let's take a third of that.
And instead of paying customers back,
let's pay lawyers."
Good job, Celsius!
Good job, Alex!
Good job to the UCC.
Good job to everybody involved.
You all did a fantastic effing job.
Freaking idiots!
These people, it just--
it boils me to no end to think that these people were the people
that we allowed to be responsible for our money.
What freaking idiots are we?
That's the question that we all have to be asking ourselves
if you have money on Celsius.
Because I feel like a freaking idiot.
These people are so dumb.
And they're scammy.
And they're frauds.
And all they want to do the whole time was pad their pockets with our money.
From $25 billion to $167 million:
How a major crypto lender collapsed and dragged many investors down with it.
In October 2021, CEO Alex Mashinsky said the crypto lender had $25 billion
in assets under management.
Even as recently as May--- despite crashing cryptocurrency prices---
the lender was managing about $11.8 billion in assets,
according to the website.
Meanwhile, Celsius owes its users about $4.7 billion,
according to its bankruptcy filing---
and there's an approximate $1.2 billion hole in its balance sheet.
It goes to show that leverage is one hell of a drug.
So, here's the point, guys.
I want you guys to look at this article date here.
It's important.
This is from July 18, 2022.
There was a big hole in Celsius.
$1.2 billion
But it's important to note that that number would fluctuate quite a bit
over the last several months,
as far as Bitcoin has been pretty volatile.
It went down to $15,400 on some exchanges,
and now we're back up about $25K today.
Super exciting news about Bitcoin today.
But that number has gone up and down.
But the point is,
there was a gigantic amount of funds on this website,
on this crypto exchange,
that they could not pay back.
And that's really why we're at where we're at today.
So, let's start talking about the plan.
So, we go back to September 14, 2022.
Celsius plans to revive the company with a focus on custody.
So, okay, here--
let me know if you've heard this before, okay?
There's a crypto exchange.
They steal everybody's money.
And then they lose everybody's money.
Now, it's a new company.
Let's give them all our money for custody.
Nobody who's on the board is on this board. Okay?
Guys, I'm sorry.
And by the end of this video, you'll understand.
It's in my personal best interest,
it's in my company's best interest to support this reorganization plan.
It's in my best interest to tell you that this new company,
totally different people,
assets under new management,
and I tell you what,
they're going to take care of your money.
It's in my best interest to tell you that.
Eff that!
You support this company after it rebirths?
And you are a low IQ troglodyte that exists in the history of the world.
You're an idiot if you give these people money again.
It's in my best interest to tell you to give them money.
You'll find out why here in just a few moments.
But it's absolutely asinine to think
they're going to reorganize into a new company that's going to focus on custody.
These people that are running this reorg have already shown they're incompetent as well.
I don't know who to trust.
I don't know who's right, who's wrong.
I don't know if Simon Dixon is right.
I don't know if Alex Mashinsky is right.
I don't know if the creditors' board is right.
I don't know if the new CEO is right.
Here's what I know.
I don't trust any of them!
I don't trust anybody in this case!
From top to bottom, I don't trust a single soul!
That's why it's been hard for me to pick a side and know what side to go with
because everybody's out for their own best interest.
And I'm here telling you that my best interest is for them to reorganize
and for you to go support that company.
I don't care about my self best interest.
What I care about is what's right and what's wrong.
And if everybody would take the scales off of their eyes
and stop looking out for what's best for them
and talk about what's best for the people that lost money,
then we would all be in for a much better plan.
This is pissing me off!
Alright. Back to this.
Celsius' CEO is planning to revive the company after the crypto crash.
According to the plan,
the company will focus on custody after returning to operation.
This plan is receiving negative reactions from the community.
Oh, that was what Alex Mashinsky said right before he resigned.
But it's great to know,
it's great to know that the new company,
the new company of Celsius,
is still focused on the same ideals that Alex had.
Bankrupt crypto lender Celsius Network's CEO, Alex Mashinsky, resigns.
CEL token was trading 8% lower.
And we're not even going to get to in this video
the impact that FTX had on Celsius
or the potential impact that Celsius had on FTX.
That's a whole nother story for a whole other day.
We're not even going to get into that today.
Let's talk about this.
Judge rules $4.2 billion belongs to Celsius.
Judge Martin Glenn ruled that the funds deposited in Earn Accounts belong to Celsius.
Okay. So, here's the story.
We all put money on Celsius.
Now, it's our crypto.
We believe that once we send it to an address on Celsius that it's still ours.
There are things in terms and conditions that would have you think that and believe that.
But the reality is, now, a judge, as of January of this year,
said that, no, that's not true.
A new update regarding the Celsius bankruptcy case came on January 4
as Judge Martin Glenn ruled that the funds deposited to Earn Accounts,
which amount to $4.2 billion, are the property of Celsius,
not the investors.
According to the document,
Celsius had around 600,000 accounts in its Earn program
when the account holders filed the lawsuit.
The funds deposited in these accounts amounted to $4.2 billion as of July 10.
Many account holders argued that they were entitled to their funds
and requested full returns.
Obviously.
If the Judge were to side with the account holders,
this decision would tie their recovery to the distributions of the unsecured creditors
under a confirmed Chapter 11 plan.
The bankrupt lender has until February 15
to submit a plan on how they'll maximize profit for all creditors and stakeholders.
So, basically, what happens here is
people go, they file a suit, and they say, "Look. This is our money.
This is not Celsius' money. This is our money."
Judge says,
"Nah. Actually, after you send it to them, it's their money. It's theirs. I'm sorry."
And so, you know what? I've got to be honest with you.
This last year has really taught us so much about custody and funds
and where to send your money.
Guys, when you send your money out of something you self-custody,
it's gone.
It's not yours anymore.
If you get it back, that's great.
It's kind of like, you know, if you really love something, let it go.
If it comes back to you, it was meant to be.
But I guess me and my Celsius money were not meant to be.
Okay. Alright. So, now, this is where it catches up to a rat today.
Celsius chooses NovaWulf's bid to exit from bankruptcy.
Now, guys, here's the thing.
We don't have a lot of options here.
If you're in Celsius.
There's not a lot of good here.
There's a bad plan.
There's a worse plan.
There's another bad plan.
And some more bad plans.
And then if none of those plans go through,
there's something terrible that will happen,
which we'll talk about.
Under the proposal by Celsius,
most creditors would receive a one-time payment of crypto
while those with larger claims would get equity in a new company.
Now, you know, here's the thing.
Your Celsius people, they're going to tell you that--
and just remember, I don't trust any of them.
I don't trust a single person.
I don't trust any of them.
They're going to tell you that the new Celsius company,
well, it's ran by different people.
There's nobody that was at Celsius when it tanked
and when they mismanaged customers funds.
There's nobody there that is going to be with the new company.
Cool, cool, cool, cool.
Well, you know what?
I actually put money on Celsius--
do you want to know why I put money on Celsius?
Because I liked Alex Mashinsky.
Because I trusted him.
Because I thought he was honorable.
Because I thought he wanted what was best for crypto.
That's why I put money on Celsius. Okay?
Stupid me. I get it.
But here's the thing.
Who the eff are these people?!
Who's taking over the company?!
I don't know them from Adam!
I don't know them from Adam.
I don't care who they are.
I don't know what they've done!
I'm not excited about a reorganization because the "people are different."
That doesn't mean anything to me!
You take a football team and you replace the coach,
will you go and replace him with somebody nobody knows?
No, you're going to go replace him with somebody that people have trust in.
I don't trust these people.
I don't know any of them!
And I think it's asinine to expect me to support some new company
that's a rebrand from Celsius ran by people that I don't know!
That's crazy!
Celsius had a great chance to succeed because it has strong leadership.
Crappy strong leadership,
but it has strong leadership.
I don't even know who these people are.
This whole thing's crappy from the bottom to the top, if you figured it out.
Bankrupt crypto lender Celsius Network has chosen NovaWulf Digital Management
as the sponsor for its proposed Chapter 11 restructuring plan,
which will see the investment advisory firm take over the operations of a new company
and most customers estimated to recover up to 70% of their funds.
"Most customers."
Ugh!
Okay, okay. Let's keep going here.
Let's keep going here.
(chuckles)
The plan notes the new board will have no "Celsius founder involvement or relationship."
Awesome!
We get a bunch of noobs!
Cool!
NovaWulf will also make a direct cash contribution
between $45 million to $55 million to the new firm.
Cool. They're getting more money.
Alright. Here's some of the stuff that is planned for the reorganization.
Now, what happens when a reorganization doesn't get voted in on?
That's important.
Long and the short of it is,
if you are a Celsius holder,
this is the only plan that we've got right now.
Nobody won the bid.
There's people bidding for it.
Nobody won it.
Judge didn't award it to anybody else.
Unless there's somebody that pops up new out of the blue
to buy sell Celsius, like Binance,
then if this reorganization plan doesn't go through,
we go to Chapter 7,
which means ain't nobody getting their money back.
Between a rock and a hard place.
That's where we're at.
Alright. So, we got this convenience class.
I love this.
They say 85% of people will get 70% of their money back.
Cool, cool, cool!
And then we got NewCo "common" equity will be 100% owned by Earn creditors.
So, if they owe you money, then, man, you got equity in the new Celsius.
You know?
That's kind of like having stock in the new Coke or the clear Pepsi.
Under the plan, creditors with claims valued $5,000 and below on the petition date
will be placed in a "Convenience Class,"
receiving "a one-time distribution of liquid crypto" paid in the form of Bitcoin, Ethereum and USDC.
So, here's the deal.
They tell you that
85% of the people on the platform are going to get 70% of their money back.
Cool!
All the people with less than $5,000.
So, all the people that you know that have their life savings on there
or have millions of dollars like we do,
what do we get back?
I got some insight into this.
So, the long and short of it is,
let me tell you what I've been told.
Now, I can't tell you.
This isn't printed yet.
People are very close to this and they're telling me that
this is what's going to happen.
It just hasn't been reported yet.
We're going to get a whopping 35% of our money back.
"Oh, what about the other 65%?"
Whoa!
We get equity in the new Celsius!
How cool is that?
35 cents on the dollar and equity in the new Celsius.
They call it Fahrenheit!
(laughs)
That was a good joke.
It's amazing I can laugh in the middle of this.
Oh, my gosh.
Yeah. So, there we go.
There's some more stupid crap about this.
I'm just sick of all this, to be honest with you.
I really am.
Here's a little bit about the Convenience Class.
Now, if you've got money greater, greater than $5,000 in there,
well, you can choose to go down the Convenience Class,
and you can get 70% of $5,000.
Cool! Awesome!
Those with a claim over $5,000—
or those with a claim of over $1,000 who opt out of the Convenience Class shares—
will receive a payment of the residual crypto after the payments to smaller accounts.
Which I've been told it's going to work out to where you get about 35%.
Now, keep in mind,
in September, we could take 33 cents on the dollar from a lawyer to buy the account.
Wish we've done that.
In addition, they will receive ownership in NewCo
through equity and management share tokens which will pay dividends to holders.
You're going to get share tokens!
Awesome! A new token for the NewCo.
Man, that is so stoked about this, guys.
Here's some graphics.
Yada, yada, yada.
There it is. There's the key highlights.
Blah, blah, blah, blah, blah.
We got the Bitcoin miners, blah, blah, blah, blah, blah.
We're all screwed. (laughs)
That's it, guys.
We're all screwed.
If you have money in Celsius,
if you-- look.
Hey, you have less than $5,000 on there?
Cool!
You're getting some money back.
Awesome!
For all those people that actually got hurt,
we're not getting hardly anything back.
And you know what? It's going to be six more months
before you can even think about receiving these funds.
Now, should you vote to support this plan?
Should the judge okay this reorganization plan?
Well, if they don't, we're screwed even more.
So, welcome to the world of Celsius,
where you get screwed,
you keep getting screwed,
and you'll get screwed in the future.
Man, that sounds like a heck of a deal.
Glad I signed up for it.
Thanks, Alex!
First 100 million people into crypto,
first 100 million people out of crypto.
That's what you did.
That's all I got.
Be blessed.
BitBoy out.