Celsius plans to mine more crypto to help fill £1bn balance sheet deficit 

Crypto lender Celsius has a $1.2bn (£1bn) hole in its balance sheet which it aims to fill by mining more crypto.

The collapsed firm, which filed for Chapter 11 bankruptcy last week, owes $5.5b (£4.6bn) in liabilities and has $4.3bn (£3.6bn) in assets. Crypto assets, which have experienced a sharp crash in prices as part of a drastic “crypto winter”, make up a large portion of these assets at $1.7bn (£1.4bn). 

But the company plans to fill this gap by mining more crypto, of which it has $720m (598m) in assets, according to its bankruptcy filings.

The company has a crypto mining operation in the US called Celsius Mining, which its filings say will, over time, “generate sufficient assets” to help the company meet its debt obligations and produce Bitcoin to provide revenue to the company.

Celsius stood by its mining plans during a bankruptcy court hearing yesterday in the US. 

Patrick Nash, a partner at law firm Kirkland & Ellis representing Celsius, said bitcoin mining could allow the company to repay customers whose assets were frozen leading up to the bankruptcy filing.

“In a world where the crypto market rebounds, the mining business has the potential to be quite valuable,” Nash said, according to Reuters. Celsius received court approval to spend $3.7m (£3.07m) on construction costs at a new bitcoin mining facility and $1.5m (£1.25m) on customs and duties on imported mining rigs.

City PM has reached out to Nash for comment. Attempts to reach Celsius were unsuccessful.