Bitcoin mining instead of crypto lending: that is the new plan of the bankrupt company Celsius. Exactly how the change in the industry will work.

Insolvent crypto lender Celsius is refocusing from the lending business to Bitcoin mining. This is evident from corresponding court documents.

The insolvency judge in Manhattan, New York, approved the conversion.

Earlier, there were objections from the Office of the United States Trustee, an agency of the U.S. Department of Justice. It argued that the conversion deviated significantly from the negotiated terms of the bankruptcy petition. However, the court rejected these objections.

The plan now provides for the following: First, Celsius will completely cease operations. Then, a new publicly traded company will be formed that will "focus exclusively on mining."

The aggrieved investors will receive shares in the new company as part of the compensation, it said.

It is still unclear what this move means for Celsius' actual reimbursement plans. In July of this year, it was announced that investors would receive part of the compensation in cryptocurrencies.

In 2022, the demise of the Terra ecosystem caused a chain reaction that also affected Celisus. In July of the same year, former CEO Alex Mashinsky's company filed for bankruptcy.

Meanwhile, the 58-year-old is being prosecuted for fraud and market manipulation. He is currently at large thanks to a bail of $40 million.

Since May 2023, the former Celsius lending service has been part of the conglomerate "Fahrenheit", which is also currently vying to take over insolvent crypto exchange FTX.