Bankrupt crypto lender Celsius proposes a sale to investment firm NovaWulf, founded in 2021 by Wall Street dealmakers; smaller creditors may regain 70% of funds
- Proposed sale would see smaller creditors get around 70% of their money back — Larger creditors would become shareholders …
The BlockBenjamin Robertson
Context & Ripple Effects
Celsius's bankruptcy has been a slow auction: Goldman Sachs explored raising $2B to buy its distressed assets before the Chapter 11 filing even landed, and the estate has since scraped for cash anywhere it can, including selling coupons and credits from Bitcoin miner Bitmain. Its creditor table is lopsided — the largest single claim is an $81M obligation to little-known fund Pharos, whose staff have links to Sam Bankman-Fried.
The NovaWulf proposal is the first concrete endgame: a firm founded only in 2021 by Wall Street dealmakers would take over, small account holders get roughly 70 cents on the dollar, and large creditors swap their claims for equity instead.
First-order effects
Smaller Celsius creditors move from indefinite freeze to a defined ~70% recovery, while large creditors like Pharos face a forced choice between cash at par-ish terms elsewhere in the plan and equity in a NovaWulf-run successor.
NovaWulf, an unknown outside the deal, instantly becomes the operator of one of crypto's most recognizable retail-lending brands and its remaining loan book.
Second-order effects
The proposal collides with the other restructuring path already in the record — a [[a:843156|court-approved poll on relaunching Celsius as a user-owned company distributing ~$2B in BTC and ETH]] — forcing creditors to weigh a Wall Street takeover against ownership themselves.
A credible 70% retail recovery resets the negotiation floor for other failed lenders' estates and for buyers like Goldman, whose earlier $2B distressed-asset raise now prices against a rival that moved faster with a whole-company bid.
Third-order effects
If the pattern holds, failed crypto lenders resolve not as liquidations but as transfers of customer books to traditional-finance operators, with retail depositors cashed out and institutional claims converted into equity of the surviving entity.
Splitting recoveries by creditor size — small holders take the haircut, big claims become upside — may become the template courts and committees reach for in the next cycle of lender insolvencies.
The trend: Crypto lender bankruptcies are resolving through Wall Street acquisitions that convert institutional claims into equity while handing retail creditors a discounted cash exit.
🚨 The Celsius creditors committee is proposing to sue a string of former executives including co-founders Alex Mashinsky, Daniel Leon and Nuke Goldstein https://cases.stretto.com/... https://twitter.com/...
@molly0xfff
Molly White on x
Celsius Unsecured Creditors Committee is proposing bringing charges against Alex Mashinsky and other Celsius execs for breach of fiduciary duty, breach of directors' duties, avoidance actions. https://twitter.com/...
@celsiusucc
@celsiusucc on x
1-In connection with its investigation, the UCC has identified significant claims and causes of action that Celsius has against Alex Mashinsky and other insiders for breaching their fiduciary obligations, fraudulent transfers, and other causes of action.
@celsiansnetwork
@celsiansnetwork on x
Celsius and the UCC are asking for clawbacks against the following insiders: - Alexander @Mashinsky - Shlomi Daniel Leon - Hanoch “Nuke” Goldstein - Harumi Urata-Thompson - Jeremie Beaudry - Johannes Treutler - Aliza Landes - Kristine Meehan Mashinsky https://twitter.com/...
@tecmosb
@tecmosb on x
The following tweets are my favorite summaries of the actions of @CelsiusNetwork insiders, including @Mashinsky et al. 1/5 https://twitter.com/...
@tecmosb
@tecmosb on x
This is a reminder that real people were hurt and continue to be hurting because of the fraud perpetrated by the @Mashinsky family and other @CelsiusNetwork execs. And if you still support them, you're a POS. https://twitter.com/...
@simondixontwitt
Simon Dixon on x
Buy high. Sell low. The Mashinsky Method. Coming to a book store near you soon. https://twitter.com/...
@celhodl
@celhodl on x
1/17 - #Celsius plan Overview👇 https://twitter.com/...
@celsiansnetwork
@celsiansnetwork on x
Founded in July of 2021, NovaWulf, a SEC registered investment advisor, seeks to leverage operational knowledge to make sound investment decisions. https://www.novawulf.io/
@celsiansnetwork
@celsiansnetwork on x
Reorg timeline. https://twitter.com/...
@celsiansnetwork
@celsiansnetwork on x
NOVAWULF BID ACCEPTED https://twitter.com/...
@simondixontwitt
Simon Dixon on x
This is correct. A US located business is more likely to get regulatory & political favour in this process. I would not want to slow things down & Novawulf is likely to be a faster process than @BankToTheFuture as we are not a US-first company. US Ch11 wants to keep tax in US. ht…
@celsiansnetwork
@celsiansnetwork on x
1/4 General Earn Creditors will receive their pro rata share of: - A significant distribution of liquid crypto (in the form of BTC, ETH and USDC) on the plan effective date
@celsiansnetwork
@celsiansnetwork on x
$5,000 convenience class. https://twitter.com/...
@celsiansnetwork
@celsiansnetwork on x
These were the leaked details from @TiffanyFong_ about the NovaWulf bid. The deal might have changed since. https://twitter.com/...
@thomasbraziel
Thomas Braziel on x
#Celsius great to see - Jason New at NovaWulf ( https://novawulf.io/team) is a legal operator/investor - great to see https://cases.stretto.com/...
@mayazi
Maya Parody on x
When the creditors are the only ones who seem to want to hold the founders responsible for a billion dollar fraud https://twitter.com/...