After crypto lender Celsius filed for bankruptcy protection on July 13, the company recently reached out to customers and explained that an employee of one of the firm’s vendors had accessed a list of emails from Celsius customers, and that the email addresses had been “transferred to a third party”. Additionally, Celsius clients have written to court asking for their crypto assets back, as one client said he had less than $1,000 in the bank and his situation was an absolute emergency in order to “keep a roof over his head.” on my family and food on their table.”
Celsius Clients Told of Email Breach, Retail Investors Say They’ve Been ‘Seriously Hit’ by Crypto Lender Fallout
It seems that Celsius was contact customers by e-mail and explaining that a list of e-mails of customers would have been transferred to a third party. The email says this was after an employee of one of Celsius’ suppliers accessed the list. The story has become a topical conversation on social media, even though crypto lender Celsius says “we do not consider the incident to be high risk for our customers whose email addresses may have been affected”. Of course, many members of the crypto community shared the news from far across TwitterFacebook and Reddit.
This is not the first time that data from Celsius customers has been hacked. Celsius reported on an “unidentified source contacted some Celsius customers through unofficial channels” in April 2021. Sources at the time said Celsius customers were solicited with phishing scams. The latest news about Celsius’ leaked emails follows the company’s filing for bankruptcy when it “filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code with of the United States Bankruptcy Court for the Southern District of New York” on July 13.
The bankruptcy filing followed the company’s withdrawal and trading pause on June 12 at 10:10 p.m. (ET). At that time, Celsius announced that it had suspended “all withdrawals, exchanges and transfers between accounts”. As for the bankruptcy proceedings, Celsius clients have been writing letters to the court asking for their crypto assets to be recovered faster than the traditional Chapter 11 bankruptcy creditor process. One client, a single mother of two daughters , said his family’s life had been greatly affected.
“My family and I are being severely impacted both financially and mentally by bankruptcy and locked up cryptos. I always check the app if my cryptos are still there. I cannot concentrate on my work or sleep,” the woman wrote in her letter to the bankruptcy court. Before Celsius went bankrupt, Celsius claimed to have about 1.7 million customers. Another Celsius client said he had less than $1,000 in his Wells Fargo bank account and that the crypto lender’s bankruptcy hurt him a lot financially. The client pointed out:
It’s an EMERGENCY, just to keep a roof over my family and food on their table.
Celsius client says he still has “full faith in crypto”
The client and many other clients who have written letters to the bankruptcy court want authorities to release the funds and distribute the crypto to retail clients. Along with bankruptcy and client letters, the crypto lender is also facing legal action from a former associate Jason Stone, the founder of Keyfi.
While client letters begged the court to release funds, some Celsius investors noted that even though the crypto lender itself was unreliable, they still trusted the crypto ecosystem. “I still have full confidence in crypto, but I have no confidence in Celsius’ management with the current team,” another Celsius client wrote in court.
Most of them are probably aware that waiting for the creditors’ allocation in a bankruptcy case can be long and tedious, and often fruitless. In addition, creditors must also prove themselves with a document called a “proof of claim”. Celsius to provided customers with information on where they can file a creditor claim.
What do you think of Celsius’ leaked emails and client letters to bankruptcy court? Let us know what you think about this topic in the comments section below.
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