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Creditors of bankrupt cryptocurrency lending platform Celsius have alleged that crypto market maker Wintermute assisted Celsius executives in manipulating the price of CEL through the use of “wash trading”.
June 23 according to Bloomberg reportsciting a recent court AdmissionCelsius creditors have now amended their lawsuit in the United States District Court for New Jersey to include Wintermute as a defendant.
Wintermute, described in the filing as an “alleged market maker in the crypto industry,” allegedly aided the Celsius CEO and other executives in “illegally manipulating and profiting from illegal wash trading of unregistered CEL tokens.” Helped. The filing states:
“Defendants Wintermute and Executive Defendants engaged in a scheme that artificially inflated the trading volume of CEL tokens sold and marketed by Celsius.”
According to the filing, the alleged scheme involving Wintermute to “launder traded CEL tokens to influence the price” was uncovered through “publicly available internal conversations” between Celsius executives.
It further claimed that Celsius executives hired Wintermute to engage in these “unfair market making” activities from around March 2021 “until Celsius becomes stable in June 2022”.
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It was noted that no measures were taken to prevent unfair market making with Celsius.
It was said, “Supposed controls were virtually non-existent, and those that did exist did not monitor or protect against “wash trading” or self-dealing.
The consortium received Celsius Network’s institutional debt portfolio, staked cryptocurrencies, mining unit and other alternative investments — in July 2022, about a year after Celsius initially filed for Chapter 11 bankruptcy.
Cointelegraph reached out to Wintermute for comment, but had not received a response by the time of publication.
Cointelegraph previously reported in May 2023 that the crypto consortium was the successful bidder to acquire Fahrenheit Celsius’ assets, previously valued at $2 billion.
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