Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-01129
Platform bankruptcy — Celsius (2023)
ConstrainedCase description
A July 2023 Celsius bankruptcy court ruling extended the January 2023 Earn decision to retail borrowers, holding that customers who had borrowed from Celsius and posted Bitcoin as collateral had also clearly and unambiguously transferred ownership of that collateral to Celsius per the terms of service. Many borrowers had assumed their collateral remained their property. The ruling meant that even customers who had actively repaid their Celsius loans could not simply recover their Bitcoin collateral; they, too, were unsecured creditors.
Custody context
| Stress condition | Documentation absent |
| Custody system | Exchange custody |
| Outcome | Constrained |
| Documentation | Unknown |
| Year observed | 2023 |
| 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. Whether full access was ultimately possible is unclear, but significant delay or outside intervention was involved.
Outcome interpretation
Access remained possible, but only with delay, dependence, or significant difficulty.
Source
Publicly Reported
Evidence type
News article
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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