Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-01025
The bankruptcy proceedings revealed that Celsius had been using customer assets
BlockedCase description
Celsius's terms of service had contained language giving the company ownership of deposited assets in exchange for yield, but the vast majority of users were unaware of this provision. Many believed their coins remained theirs in the same way a brokerage holds stocks. The bankruptcy proceedings revealed that Celsius had been using customer assets for risky DeFi strategies and loans. Customers lacked documentation proving any segregation of their holdings.
Custody context
| Stress condition | Documentation absent |
| Custody system | Exchange custody |
| Outcome | Blocked |
| Documentation | Unknown |
| Year observed | 2022 |
| Country | United States |
Structural dependencies observed
What this illustrates
Nobody had written down how to get back in. That knowledge existed only in the owner's head. Access was not recoverable.
Outcome interpretation
Access was not possible under the reported conditions.
Source
Publicly Reported
Evidence type
News article
Evidence link
Related cases involving documentation absent
This archive documents observed custody survivability failures. It does not attempt to document all Bitcoin losses or security incidents.
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Framework references
Where Bitcoin Custody Intersects Legal and Fiduciary Authority
Where custody creates gaps in estate planning, fiduciary duty, and professional responsibility.
Professional Scope Boundary Matrix
What each professional or product covers, what they do not, and where gaps form between them.
The Independent Assessment Layer in Bitcoin Custody
How independent diagnostic layers emerge when multiple parties depend on shared infrastructure.
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