Bankruptcy filings from Celsius and Voyager have raised questions about what happens to investors’ crypto when a platform fails.
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Cryptocurrency service provider Prime Trust on Thursday agreed to return $17 million from crypto lending platform C, which it allegedly withheld when digital currencies bottomed out. first last year.
Prime Trust, which provides custodial services for digital assets, took hold of $119 million in Celsius assets when the two terminated their contracts in June 2021, according to reports. Celsius’s lawsuit against the Prime Trust in August. Prime Trust “refused to fulfill its obligations” by transferring $17 million in crypto assets when the contract was dissolved, Celsius said.
Bitcoin was volatile last year, hitting a record in April 2021 of $63,000 before losing almost half its value in July. It revived to a new record of over $64,000 in November and currently trading at around $19,000.
Celsius filed for Chapter 11 bankruptcy protection in July.
Prime Trust agreed at a hearing in the United States Bankruptcy Court for the Southern District of New York on Thursday to return crypto assets to settle the lawsuit. Those assets will be held in a separate account until the court finds out how to distribute Celsius’ assets.
