Celsius Network filed a lawsuit to recover funds withdrawn before bankruptcy

ChainCatcher news, according to CryptoSlate, the bankruptcy trustee of the collapsed cryptocurrency lending company Celsius Network has filed a lawsuit against account holders who received preferential transfers within 90 days prior to the company's bankruptcy filing. These lawsuits were filed in the U.S. Bankruptcy Court for the Southern District of New York, targeting accounts with withdrawal priority exposure (WPE) exceeding $100,000.

Previously, the company successfully settled with over 1,500 account holders, recovering nearly $100 million. These settlements addressed over $500 million in priority debt issues, providing significant relief to eligible Celsius creditors.

During the priority period from April 14, 2022, to July 13, 2022, massive withdrawals led to severe financial imbalances for the company, ultimately resulting in bankruptcy after the priority period ended. Former CEO Alex Mashinsky and other executives of Celsius are facing allegations of fraud and market manipulation, which contributed to the company's collapse.