Celsius Network CEO Alex Mashinsky submitted a letter of resignation Tuesday, months after the crypto company filed for Chapter 11 bankruptcy protection.
Mashinsky’s resignation is effective immediately, but he said in a release that he will continue to help the company provide creditors with the “best outcome.”
“I regret that my continued role as CEO has become an increasing distraction, and I am very sorry about the difficult financial circumstances members of our community are facing,” he wrote in the letter.
“Since the pause, I have worked tirelessly to help the Company and its advisors put forward a viable plan for the Company to return coins to creditors in the fairest and most efficient way.”
After the announcement was made, the company’s cryptocurrency, the Cel token, dropped more than 7% in value.
As of May, Celsius was one of the largest players in the crypto lending space with more than $8 billion in loans to clients and almost $12 billion in assets under management. The firm would lend customers’ crypto out to counterparties willing to pay sky-high interest rates to borrow it, and Celsius would then split some of that revenue with users.
The structure came crashing down during a liquidity crunch in the industry and resulted in Celsius pausing withdrawals in June. The collapse in the market also caused other companies to freeze assets and at least three to file for bankruptcy.
As previously reported, the crypto company saw a range of internal missteps leading up to its recent turmoil, according to former employees and internal documents. Multiple employees painted a picture of risk-taking, disorganization and alleged market manipulation.