Chainalysis Beats Most Celsius Claims

Chainalysis has won dismissal of most claims brought by Celsius Network’s litigation administrator, but a federal judge kept alive one allegation tied to a disputed 2020 asset verification that Celsius promoted as a $3.3 billion “audit.”

U.S. District Judge Margaret Garnett ruled on Sept. 29 that the complaint adequately pleaded a claim accusing Chainalysis of aiding and abetting breaches of fiduciary duty by Celsius insiders. The ruling allows that claim to continue without deciding whether the allegations are true.

Judge Dismisses 15 Of 16 Claims Against Chainalysis

The Southern District of New York dismissed 12 claims with prejudice, meaning they cannot be refiled in the case. Three consumer protection claims were dismissed without prejudice, allowing the plaintiffs to amend them.

Blockchain Recovery Investment Consortium, which serves as Celsius’ litigation administrator and recovery manager, brought the case. Count One was filed on behalf of Celsius, while the remaining claims came from former customers who assigned their claims to the administrator.

Surviving Claim Centers On Celsius’ $3.3B Asset Figure

The dispute dates to 2020, when Celsius used Chainalysis Reactor software to calculate assets under management. The complaint says a Celsius executive initially calculated about $1.18 billion before the methodology was changed and the figure increased to roughly $3.3 billion.

Celsius later issued a Dec. 9 press release describing the work as an audit confirming $3.318 billion in assets. The lawsuit alleges Chainalysis helped draft, edit and approve the release and knew statements describing the process as an audit and independent verification were false or misleading. Chainalysis sought dismissal of the complaint in full.

Celsius Administrator has Until October 20 to Amend Three Claims

The court found the allegations supporting the aiding-and-abetting claim sufficient to survive the dismissal stage.

Chainalysis had argued that the complaint failed to plead knowing participation and that other legal doctrines barred the claim, but the judge rejected those arguments at this stage.

The litigation administrator has until Oct. 20 to amend the three consumer protection claims dismissed without prejudice. If it does not amend them, it must notify the court by the same deadline, leaving the fiduciary-duty claim as the core dispute moving forward.