On Tuesday, U.S. District Judge Margaret Garnett dismissed 12 claims with prejudice and three without prejudice in the Celsius case against Chainalysis, but declined to dismiss the claim of aiding breach of fiduciary duty related to the disputed $3.3 billion 'audit.'

The Court Cited Possible Knowledge of False 2020 Press Release

The judge denied Chainalysis's motion to fully dismiss the lawsuit, stating that the complaint sufficiently alleges that Chainalysis knew about false statements in the 2020 press release and helped disseminate them.

12 Claims Dismissed With Prejudice, Three May Be Amended by October 20

Twelve other claims were dismissed with prejudice, preventing plaintiffs from amending them in this case. Three consumer protection claims were dismissed without prejudice; plaintiffs have until October 20 to amend them or notify the court if they will not do so.

How the $3.3 Billion 'Audit' Originated

In 2020, Celsius engaged Chainalysis to calculate assets under management (AUM) using the Reactor software and later presented the results as an 'audit.' According to the complaint, the initial calculation using Reactor found about $1.18 billion in assets, but after changes in methodology, the figure rose to approximately $3.3 billion. A press release on December 9, 2020, announced an 'audit' confirming about $3.3 billion in Celsius assets based on transactions, total deposits, and withdrawals since the service launched in 2018. The complaint alleges that Chainalysis helped prepare and approve the release and knew that the terms 'audit' and 'independent review' were false or materially misleading. These allegations have not been proven; Chainalysis sought full dismissal of the complaint.

BRIC Filed the Lawsuit on Behalf of Celsius Creditors

The lawsuit was filed by the Blockchain Recovery Investment Consortium (BRIC), which acts as the litigation administrator and asset recovery manager for the Celsius estate and pursues claims on behalf of the company and some former clients. Celsius filed for bankruptcy in July 2022 after freezing withdrawals a month earlier, leaving clients without access to about $4.7 billion in assets.