Celsius hires new restructuring lawyers to help navigate its options: WSJ

Quick Take

  • WSJ reports that Celsius has hired new lawyers from Kirkland & Ellis LLP to advise it on possible restructuring options amid the fallout of the lending protocol.
  • It previously retained a team from Akin Gump Strauss Hauer & Feld LLP.
  • In late June, The Block reported that Celsius was resisting legal advice it received to file for Chapter 11 bankruptcy. 

Celsius has hired new counsel to advise it through a possible restructuring — weeks after the lending platform suspended withdrawals amid a drawdown in cryptocurrency prices. 

As per the Wall Street Journal, Celsius has replaced its lead restructuring counsel with a team from Kirkland & Ellis LLP. Lawyers from Kirkland & Ellis will advise Celsius on options including bankruptcy filing, sources familiar with the matter told the publication. Celsius had previously brought on lawyers from Akin Gump Strauss Hauer & Feld LLP to help the firm navigate its options. Neither Kirkland & Ellis nor Akin Gump Strauss Hauer & Feld responded to a request for comment during off market hours. 

Celsius's management has not yet shared a path forward since the market plunge left the company in an unstable liquidity position from which it has yet to recover. Still, recent reports indicate it has brought on a team of restructuring lawyers and appointed Citigroup to advise it on potential financing options. 

In late June, The Block reported that lawyers hired by the lender were advocating for Chapter 11 bankruptcy. Chapter 11 bankruptcy allows a company to continue operations while meeting its financial obligations to indebted parties. That's usually executed by proposing a plan of reorganization to be approved by creditors and overseen by a legal team. 

Celsius remained unable to make any public statements due to legal advice, but people with knowledge of the situation told The Block the firm was looking to avoid lengthy bankruptcy proceedings. Sources said Celsius believes much of its retail clientele would prefer the firm avoid bankruptcy and that users could show their support by engaging "HODL Mode" in their Celsius account, a security feature that keeps users from withdrawing or sending funds while activated, in the hopes that the legal team would see the strength of feeling existing among users. Celsius did not respond to requests for comment at that time.


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As of June 30, Celsius shared a blog post with the community saying it was continuing to take "important steps to preserve and protect assets and explore options available to us." 

"These options include pursuing strategic transactions as well as a restructuring of our liabilities, among other avenues," said the post. "These exhaustive explorations are complex and take time, but we want the community to know that our teams are working with experts from many different disciplines."

The firm said it would continue to share information "when it becomes appropriate." It did not respond to a request for comment made during off market hours. 

Kirkland & Ellis is also representing Voyager Digital, the crypto broker and lender that filed for Chapter 11 bankruptcy last week. Its restructuring plan aims to resume account access and return value to customers.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

Aislinn Keely is a reporter on The Block's policy team holding down the legal beat. She covers court decisions, bankruptcies, regulatory actions and other key moments in the legal sphere, putting them in context for the wider crypto industry. Before The Block, she lent her voice to the NPR affiliate WFUV and helmed Fordham University's student newspaper. Send tips or thoughts on all things policy and legal to [email protected] or follow her on Twitter for updates @AislinnKeely.