Citigroup is advising C on potential solutions after withdrawal freeze

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Two people familiar with the matter told The Block that Celsius hired banking giant Citigroup to advise on possible solutions after the ailing crypto lender halted customer withdrawals on Sunday.

Celsius has hired Citigroup “in an advisory capacity,” but “it’s not as if Citi is going to give Celsius any money off its balance sheet,” one of the people said.

He added that Citigroup is advising Celsius on “potential financing options.”

The person said the investment bank is also advising Celsius on proposals like rival Nexo. Earlier this week, Nexo Celsius made an offer to acquire “Celcel’s remaining qualifying assets, primarily its secured loan portfolio.”

According to the source, Citigroup and Celsius are not new to each other. He said the bank also advised Celsius on its mining subsidiary’s business and initial public offering (IPO).

Last month, Celsius announced that its wholly-owned bitcoin mining subsidiary, Celsius Mining, had confidentially filed a draft registration statement on Form S-1 with the Securities and Exchange Commission (SEC). The registration statement is expected to become effective once the SEC completes its review process, subject to market and other conditions.

Citigroup declined to comment on The Block when contacted, and Celsius did not respond to a request for comment as of press time.

The Wall Street Journal reported yesterday that Celsius has also hired restructuring attorneys from the law firm Akin Gump Strauss Hauer & Feld LLP to advise on possible solutions. The block contacted Akin Gump regarding the report but had received no comment as of press time.

Celsius abruptly halted withdrawals, swaps and inter-account transfers on Sunday due to extreme market volatility. As a result, its customers’ money is stuck.

Celsius tweeted Tuesday that it was “working 24/7 for our community.” Earlier this week, Celsius said it would share information whenever appropriate.

© 2022 Block Crypto, Inc. All rights reserved. This article is for informational purposes only. It is not offered or intended to be relied upon as legal, tax, investment, financial or other advice.

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