Bankrupt crypto lender Celsius gets the go-ahead to hand out $2.8 million in bonuses to keep employees from quitting

alex mashinsky celsius
Celsius Network co-founder and CEO Alex Mashinsky.Piaras Ó Mídheach/Sportsfile for Web Summit via Getty Images
  • Celsius has secured court approval to hand out up to $2.8 million in employee bonuses, per Bloomberg.

  • The payments are meant to keep staff at the crypto lender from quitting as it works to exit bankruptcy.

  • Celsius has also asked the court to let it sell $18 million of user-deposited crypto to pay its bills.

Bankrupt cryptocurrency lender Celsius has secured a judge's approval for its plan to hand out bonuses worth up to $2.8 million to keep key staff from quitting, Bloomberg has reported.

Celsius asked the New York judge handling its bankruptcy case to help it prevent key workers from being poached by competitors, according to court filings. At a Monday hearing, Judge Martin Glenn approved its request, the Bloomberg report said.

The crypto lending firm filed for Chapter 11 bankruptcy protection in July, caught up in a crash in prices of digital currencies. Celsius — which had almost 12 million customers and managed $11 billion in assets as of May — faces a $1.2 billion gap in its balance sheet.

Its failure prompted a staff exodus, and only about 170 employees remain of the 370 or so it had in July, the company told the court, per Bloomberg.

The bonuses will be paid to rank-and-file employees to keep operations running while Celsius works on exiting bankruptcy. The crypto lender is due to file a restructuring plan by February 15.

Staff with salaries between $25,000 and $425,000 will be eligible for the bonus payments, most of which will be $75,000 or under.

In a November 21 filing, Celsius asked the court to restrict access to the employees' names, salaries and other confidential details, saying it would harm the company's ability to maximize the value of its assets. The lender also said it could "negatively affect employee morale" if the workers learned certain information about their colleagues.

In a separate request, Celsius has asked for permission to sell $18 million of crypto assets on its balance sheet to continue paying bills while it works on a way to repay its creditors. The coins it wishes to sell come from Celsius customers who deposited the assets into interest-bearing accounts before the company collapsed, and Celsius argues they handed over ownership to the company.

"I am going to go ahead and decide who it belongs to," Glenn said in the hearing, per Bloomberg.

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