Private-equity giant Apollo Global Investments has joined the bid for bankrupt crypto lender Celsius Network. Apollo, which manages $500bn in assets, is an investor in the bid submitted by NovaWulf. Celsius has also publicly identified several entities willing to purchase the company. The revamped Celsius Network will include bitcoin mining and participation in Ethereum staking. It will also allow the issuance of blockchain-based security tokens representing ownership interests in itself according to a person familiar with the matter.
Several crypto firms became victims of the 2022 downturn, leading to bankruptcies. High-profile collapses such as that of the Terra ecosystem and FTX later that year also affected the broader industry. Several players in the crypto industry have shown interest in acquiring key assets of bankrupt lenders like Celsius and Voyager, but traditional financial markets have preferred to stay away.
What will happen if NovaWulf acquires Celsius
If NovaWulf wins the bid for Celsius, investors will receive a tiered management fee and an incentive fee tied to the restructured net asset value (NAV) of the troubled crypto lender. To facilitate the trading and issuance of equity tokens, NovaWulf has partnered with the Provenance Blockchain. The figure, the sister fintech firm of Provenance, will provide the infrastructure for the tokenised securities.
Provenance uses the Cosmos blockchain as its underlying ledger and has more than $7bn in total locked value (TVL). As per Provenance Blockchain CEO Morgan McKenney, they have the largest trove of on-chain assets outside of Ethereum. Figure qualifies as a broker-dealer and has an alternative trading system exemption to trade natively issued blockchain securities. Speaking about Apollo’s interest in Celsius, McKenney said that the private equity firm is a “flagship”, that is “leading the industry into the future. Apollo is huge in credit, they know everything about credit”.
