Simon Dixon

Leaked bids: Binance, Galaxy Digital among secret bidders for Celsius assets

Crypto blogger Tiffany Fong has shared documents she claims to have obtained in late December detailing several bids for Celsius’ crypto assets.

At least five firms placed bids on Celsius Network’s crypto assets, including Binance, Bank To The Future and Galaxy Digital, according to leaked information shared by crypto blogger Tiffany Fong. 

Fong, a follower of Celsius developments who shot to fame after several exclusive interviews with Sam Bankman-Fried following FTX’s collapse, has published documents she says were obtained on Dec. 20 “detailing the bids on Celsius Network’s crypto assets.”

In a Substack post, Fong explained that she initially refrained from leaking the bids to avoid disrupting the bidding process but was prompted to do so after recent commentary from a lawyer representing Celsius.

“I refrained from sharing the bids publicly to avoid disrupting the bidding procedures or negatively impacting customer recoveries; however, in yesterday’s Celsius Network court hearing (1/24/23), Kirkland & Ellis attorney Ross M. Kwasteniet proclaimed the bids ‘have not been compelling,” Fong explained.

Among the bidders revealed by Fong include crypto exchange Binance, online investment platform Bank To The Future, digital asset investment manager Galaxy Digital, crypto trading company Cumberland DRW and digital asset investment firm NovaWulf.

According to Fong, the proposals from these crypto firms were submitted in November, but they were “for the most part, abandoned.”

Fong stated that Binance proposed a bid of $15 million for the assets, with $12 million earmarked for the Celsius estate and $3 million to be distributed to “migrated users on a pro-rata basis.”

In the purported Summary Term Sheet from Binance, the crypto exchange said that it intends to “acquire and transfer all liquid and certain illiquid crypto” at the fair market value to Binance’s platform.

Galaxy Digital proposed to acquire all illiquid and staked Ether (ETH) assets as it sought to be the “designed stalking horse bidder” — a name given to the initial bidder for the sale of distressed assets — for the amount of approximately $67 million.

Meanwhile, Bank To The Future’s bid stated in its transaction structure that all liquid crypto assets and collateral werto be returned to creditors pro rata, under the management of Bank To The Future.

In a Jan. 26 tweet, Bank To The Future CEO Simon Dixon has since confirmed that the contents of the leaked bids relating to his firm were accurate.

Fong noted in the blog post that she is “only aware of these five bids” on Celsius’ crypto assets.

She added that Novawulf’s bid was “particularly interesting,” due to having a vague resemblance to “Celsius Network’s newly-proposed restructuring plans.”

In comments to Cointelegraph, Fong said that she has had conversations with “multiple Celsius Network employees” and to her surprise, most employees “were not even made privy to the bids.”

She added that “not even those in upper-level management” were aware of this information.

Related: Celsius amasses 30 potential bidders for its assets, withdrawal motion approved

Fong said that creditors and “even most employees” have been left in the dark about the bids on crypto assets that investors deposited onto the platform.

Fong is not sure how “things will unfold,” but thinks that creditors deserve “more transparency” and have a right to see the bids on assets that “we deposited onto the platform.”

Binance declined to comment, saying that “as a matter of policy, we do not comment on speculations, rumors or deals in progress.”

Cointelegraph has reached out for comments from Galaxy Digital, Bank To The Future, NovaWulf and Cumberland DRW.

Update (Jan. 27, 6:39AM UTC): Added statement from Binance spokesperson.

BnkToTheFuture unveils 3 proposals to rescue Celsius from oblivion

BnkToTheFuture’s three proposals include two different ways to restructure and relaunch the firm or an option to co-invest in the firm with a bunch of Bitcoin whales.

Celsius’ lead investor BnkToTheFuture has outlined three proposals to save Celsius from bankruptcy while finding a good outcome for shareholders and depositors with funds stuck on the platform.

Shared on Twitter by BnkToTheFuture CEO Simon Dixon on Thursday, the three distinct proposals include either two options of restructuring and relaunching Celsius or potentially co-investing in the platform alongside wealthy Bitcoin (BTC) whales.

“Proposal #1: A restructuring to relaunch Celsius and allow depositors to benefit from any recovery through financial engineering.”

“Proposal #2: A pool of the most influential whales in Bitcoin to co-invest with the community.”

“Proposal #3: An operational plan that allows a new entity and team to rebuild and make depositors whole.” 

Dixon previously referred to “financial innovation” being needed to be applied to Celsius, similar to the issuance of equity debt tokens like in the case of Bitfinex in 2016, which were designed to represent $1.00 of debt per token.

“We believe all attempts should be made to make depositors whole in order to maintain shareholder value,” the team wrote, adding it will be calling for a shareholder meeting that “legally cannot be ignored by the Celsius board:”

“Bnk To The Future Capital SPC holds over 5% of Celsius shares and therefore we believe that this allows us to call a shareholder meeting as part of our statutory shareholder rights that legally cannot be ignored by the Celsius board.”

BnkToTheFuture also suggested that after first submitting these proposals to Celsius and its advisers, it is now looking to “apply pressure” on the firm after getting “worried that time was running out” with its lack of a distinct plan of action. These sentiments were also echoed by Dixon in a Digital Assets News Interview on the same day:

“You have to move really fast, because the longer you go on, the more FUD comes out, bad PR comes out, more predatory offers come out, the more the community stops believing in what they originally believed in.”

Celsius’ users have been unable to withdraw assets from the platform since June 13 amid the firm’s ongoing liquidity issues. Meanwhile, there are fears that users may never get their funds back if the company were to go bankrupt.

Celsius may have its own solution

In a blog post on Friday, Celsius stated that it is working as fast as it can to stabilize its liquidity problems so that it can be “positioned to share more information with the community.”

While the firm did not reveal much about what this entails, Celsius stated that it is exploring options to protect its assets such as pursuing strategic transactions as well as a restructuring of our liabilities, among other avenues.

“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 blog post read.

FTX walked away from Celsius deal over bad financials

Related: Contagion: Genesis faces huge losses, BlockFi’s $1B loan, Celsius’s risky model

Reports surfaced on Thursday that Sam Bankman-Fried’s crypto exchange FTX recently walked away from a deal to purchase Celsius after finding a $2 billion hole in the company’s finances.

According to two unnamed sources close to the matter, FTX had entered talks with Celsius to either provide financial support or acquire the firm outright. However, apart from having $2 billion, an account for Celsius was said to be difficult to deal with.