Crypto asset lending platform Celsius went public with its unhealthy finances after it filed for bankruptcy.
Celsius’s projected budget to the end of October 2022 will result in Celsius having a net cash flow of negative $137.2 million, becoming net debt, according to Celsius’s property report filed to the Court on October 14.
The projected budget for future mining revenue Celsius includes an increase in operating expenses of $85.4 million by the end of October, of which $13.9 million will be used to pay employees;
$57.3 million was spent on mining hardware.
Celsius Chief Executive Alex Mashinsky said in the report that he expected mining to generate sufficient revenue for the company in the future.
As a result, the Texas Securities Commission (TSSB) filed an objection against Celsius on May 5, stating that Celsius will not be able to explain in detail the sale of mined bitcoin. SSB will not object to Celsius selling mined bitcoin to increase liquid assets.
SSB is, however, very concerned about Celsius’s requirement for a broad licence to use these assets.
The creditors’ committee, made up of unsecured creditors, has also taken a dim view of mining, and a court filing filed on Monday said Celsius’s plans to mine and sell cryptocurrency were unclear.
As summed up on Twitter by FT reporter Kadhim Shubber, who reviewed Celsius’s budget plan as presented on Sunday, two striking facts emerged:
1.Celsius burned $46 million per month for the next three months, generating significant negative cash flow.
2. Customer has stored 100,000 BTC in Celsius, but only 15,000 BTC and 23,000 wBTC are stored in Celsius.
Lawyer @wassielawyer explained the high cost in detail, saying Celsius had set aside $33 million for the next three months to pay financial and legal counsel for bankruptcy reorganization. “Professional counsel always wins in bankruptcy protection,” he said.