The Arrington Capital-backed consortium outbid NovaWulf for Celsius’ assets, with the Blockchain Recovery Investment Group chosen as a backup.
According to early Thursday morning court filings, cryptocurrency consortium Fahrenheit has won the bid to buy insolvent lender Celsius Network, whose assets were originally valued at about $2 billion.
According to the court records, the company will purchase Celsius’s institutional loan portfolio, staked cryptocurrency, mining operation, and other alternative investments. To finalize the sale, the group must make a deposit of $10 million within three days.
After a lengthy auction, the winning bidder was chosen as Fahrenheit, a group of bidders that consists of the venture capital company Arrington Capital and miner US Bitcoin Corp.
It was decided to go with the Blockchain Recovery Investment Consortium, which also comprises GXD Labs LLC and Van Eck Absolute Return Advisers Corporation, as a backup, while competitor bidder NovaWulf, who was once the firm favorite, was unable to succeed.
According to the terms of the agreement, US Bitcoin Corp would build a number of cryptocurrency mining facilities, including a new 100-megawatt plant, and the new business will get between $450 and $500 million in liquid cryptocurrency.
Despite being accepted by Celsius and a committee of its creditors, the acquisition still needs approval from authorities. Judge Martin Glenn of the Bankruptcy Court previously issued a warning that “regulatory roadblocks” would prevent the sale of Celsius, just as they did for another lender’s acquisition. The $1 billion in assets owned by bankrupt cryptocurrency lender Voyager were abruptly terminated by cryptocurrency exchange Binance.US in April after federal officials protested the sale, citing the “hostile and uncertain regulatory climate” in the U.S.
Last July, Celsius declared bankruptcy after collapsing cryptocurrency prices sparked a bank-run-style rush of withdrawals that revealed the platform’s severe liquidity problems. The collapse of the exchange was a warning of things to come for the cryptocurrency sector, which eventually experienced the failure of a number of other well-known crypto exchanges, lenders, and venture capital firms, sending the sector into a prolonged deep winter.