"We are interested in learning about Celsius and its assets, and whether any could be relevant to our business," Ripple’s spokesperson told Reuters, but declined to say if the company was interested in acquiring Celsius outright.
Celsius, one of the crypto industry’s largest lenders with $25 billion in assets, halted all operations on June 13, citing “extreme market conditions.” The company attempted to soften the blow, saying the move was a “necessary action for the benefit of our entire community in order to stabilize liquidity and operations while we take steps to preserve and protect assets.” However, such an announcement has made investors’ panic impossible to contain, driving down the price of Celsius’ native token CEL.
In July, Celsius filed for Chapter 11 bankruptcy, announcing that it has $167 million in cash on hand and a $1.19 billion deficit on the balance sheet. Before declaring its insolvency, the crypto lender hurriedly repaid its debts to several DeFi protocols, reclaiming over $1 billion in collateral.
According to Celsius’ bankruptcy filings, its current assets include cash, cryptocurrencies, loans, a bitcoin mining business, the company's own CEL token, and various digital assets within its custody accounts.
Shortly after Celsius announced it was freezing withdrawals and transfers on the platform, the rivaling lending company Nexo said it was interested in buying certain assets from Celsius. In a letter to the insolvent company, Nexo stated that it was looking to purchase "mostly or fully of collateralized loan receivables secured by corresponding collateral assets, as well as brand assets and the customer database." Celsius, however, didn’t respond to the proposal.
FTX was also in talks with Celsius over an acquisition, but walked away from the deal after examining its balance sheet, which was reported to have a "$2 billion hole." It’s unclear whether the state of its finance has improved since then.
Ripple’s spokesperson noted that the company "is actively looking for M&A [merge and acquisition] opportunities to strategically scale the company," as it continues to grow through the crypto market turmoil.
Ripple was sued by the U.S. Security and Exchange Commission (SEC) in December 2020 for selling XRP tokens, which the regulator classified as unregistered securities. Since then, the company engaged in an exhausting legal brawl to prove that XRP was a commodity. The outcome of the case is believed to be decisive for the US crypto industry, as it would set a precedent for the rest of ICO-issued cryptocurrencies, including Ethereum.