• Creditors of the bankrupt landing firm Celsius have amended their lawsuit to include Wintermute Trading Ltd.
  • Plaintiffs allege that Wintermute helped in wash trading activities with the help of Celsius executives.
  • Fahrenheit has acquired Celsius’ assets, which were previously valued at $2 billion.

Crypto Firm Wintermute Entangled in Lawsuit Against Celsius Network

Creditors of the bankrupt landing firm Celsius have amended their lawsuit to include Wintermute Trading Ltd. Plaintiffs in the class-action lawsuit against Celsius Network have alleged that Wintermute helped the crypto lending firm in wash trading activities with the help of Celsius executives. The new court filing shows that these activities took place between March 2021 and June 2022, when withdrawals from Celsius were frozen.

Allegations Against Celsius Executives

The latest amendment in the lawsuit alleges that executives at Celsius manipulated CEL prices through wash trading with the help of algorithmic trading firm Wintermute. Wash trading is an illegal activity where a security or crypto is sold and bought to generate misleading market information. The new allegations directly affect those who purchased a Celsius Financial Product through a Rewards Account and subsequently filed a class-action lawsuit against the firm.

Transfer of Assets by Celsius Before Bankruptcy

Before filing for bankruptcy, it was reported that around $160 million worth of wrapped Bitcoin was transferred to third-party wallets by Celsius; several of those addresses are reportedly controlled by Wintermute. Additionally, approximately $20 million worth of WETH was moved into a wallet belonging to Wintermute in May this year.

Fahrenheit Acquires Assets

Crypto consortium Fahrenheit won an auction to acquire the assets of Celsius, which were previously valued at $2 billion; these include staked cryptocurrencies, mining unit, institutional loan portfolio, and other alternative investments. The agreement will allow Fahrenheit to receive liquid cryptocurrency estimated between $450 million and $500 million.

Conclusion

The creditors’ allegations against Kelvin Network are still being investigated but recent developments suggest that Kelvin’s financial troubles may be linked to manipulation tactics used by its executives with assistance from outside firms like Wintermute Trading Ltd.. Meanwhile, Fahrenheit has acquired all assets held by Kelvin prior to its bankruptcy filing, allowing it access to significant amount liquid cryptocurrency as part of its acquisition deal .