Investment giant Goldman Sachs is said to be attempting to raise US$2 billion in an effort to buy the assets of distressed crypto lending firm Celsius amid the current turmoil engulfing the cryptocurrency industry.
The capital would allow Goldman Sachs to buy Celsius’ assets at a massive discount, should the company file for bankruptcy:
‘Fake News’ Claim Regarding Rumours
The bank has been looking into commitments from Web3 crypto funds specialising in distressed assets, and traditional financial institutions with cash on hand. The assets to be acquired, most likely cryptocurrencies having to be sold at a low, would then likely be managed by participants taking part in the fundraising.
However, angel investor Simon Dixon has claimed that the rumours are fake news, according to a “source” at Goldman Sachs:
Drama unfolded earlier this month with Celsius when the crypto lender had to halt withdrawals as well as other services on its platform, but only after it transferred over US$300 million in digital assets to FTX.
Users May Yet Be Left High and Dry
Concerns also exist that Celsius may be left unable to pay out users wanting to withdraw their funds if the value of staked ETH doesn’t regain parity with ETH. Staked ETH, which is extensively used by Celsius, started to lose parity with ETH when DeFi markets were sent into a spiral following the collapse of the Terra ecosystem. In the time since, Celsius has hired the restructuring consulting firm Alvarez & Marsal.
The company has also reached out to restructuring attorneys from the law firm Akin Gump Strauss Hauer & Feld. Additionally, global investment bank Citigroup has been employed by Celsius to advise on possible solutions, which include an assessment of an offer from rival crypto lender Nexo. Citigroup and Akin Gump have both recommended that Celsius file for bankruptcy.
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