Celsius demands $150 million return from StakeHound

Celsius burn-min
Celsius burn-min

Bankruptcy company Celsius Network accused the LSD platform StakeHound of violating obligations regarding the placement of tokens in the amount of ~ $ 150.3 million.

The figure includes ~$120M in Ethereum, ~$30M in Polygon, and ~$300,000 in Polkadot.

In addition to not returning the tokens, the platform violated bankruptcy rules by launching arbitration proceedings against a business in Switzerland, the document says.

Lawyers are counting not only on the return of assets, but also on compensation for damages and the services of lawyers.

In June 2021, Stakehound closed down operations. According to Celsius lawyers, the platform has refused to reverse convert 35,000 so-called stTokens into Ethereum.

Stakehound representatives pointed to the loss of the private keys necessary for the operation. In June 2021, the firm accused custodian partner Fireblocks of negligence responsible for the incident.

In April 2023, as part of the bankruptcy process, Stakehound announced that Celsius had no obligation to exchange stTokens for ETH.

According to the lawyers of the landing platform, the launch of the arbitration process violates Section 362 of the US Bankruptcy Code.

Known as “automatic suspension”, the provision prevents creditors and other entities from collecting debts or bringing legal action against a company that has filed for bankruptcy.

Celsius accounted for over 90% of StakeHound’s business, according to the document.

In April 2023, after the Shapella hard fork, the owners of locked ETH in Beacon Chain got the opportunity to withdraw their assets. StakeHound refused to confirm the unlocking of coins owned by Celsius.

In June 2022, Celsius suspended withdrawals, exchanges and transfers between accounts “due to extreme market conditions”.

In July, after filing for bankruptcy, Celsius reported a $1.2 billion hole in its balance sheet. In August, it became known that the company’s liabilities exceeded its assets by $2.85 billion.

Recall that in May 2023, the platform transferred $74.3 million in Ethereum to the Figment staking service.

Celsius later moved $776 million of stETH ahead of the launch of Lido Finance v2. After that, she prepared altcoins worth about $74 million to convert them into bitcoin and Ethereum as part of the settlement with creditors.

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