Dive Brief:

• Celsius Chief Strategy Officer Shlomi Daniel Leon has left the company he co-founded, according to an internal memo seen Tuesday by CNBC, and will be replaced by Group Tax Director Lior Koren.
• Leon leaves the bankrupt Hoboken, New Jersey-based company about a week after co-founder Alex Mashinsky stepped down as CEO. Calls for Mashinsky’s resignation came from a committee representing Celsius’ unsecured creditors, which felt that allowing him to remain at the helm “was unacceptable and not in the best interests of the estates,” according to court documents.
• Leon’s departure comes about two weeks ahead of the bid deadline for other firms to snatch up Celsius’ assets.

Dive Insight:

Once one of the largest crypto lending platforms, Celsius had a dazzling downfall this summer when it froze withdrawals for its 1.7 million customers over liquidity issues, leaving customers unable to access the roughly $12 billion Celsius had under management.

When it filed for bankruptcy in July — shortly after a former employee sued the company and accused it of being a Ponzi scheme — a $1.19 billion deficit was revealed.

In his resignation letter last week, Mashinsky wrote, “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. Since the pause, I have worked tirelessly to help the Company and its advisors put forward a viable plan ... to return coins to creditors in the fairest and most efficient way.”

Following his resignation, reports emerged that Mashinsky withdrew $10 million from Celsius ahead of freezing all accounts. While this drew speculations about the actions of Mashinsky and executives leading up to the business’ downfall, a spokesperson for Mashinsky told the Financial Times the former CEO used most of that money to cover taxes, paid it back leading up to the freeze, and that he and his family still had $44 million stuck in frozen Celsius accounts.

The reason for Leon’s resignation is not yet clear, and Celsius did not return a request for comment by press time. Last month, he filed a motion declaring his 32,600 shares of Celsius common stock worthless as a part of his bankruptcy court case.

Leon’s resignation is on trend with recent crypto market happenings, following not just Mashinsky but FTX U.S. President Brett Harrison, Kraken CEO Jesse Powell and others. The resignations come amid a crypto winter, the digital asset space’s equivalent to a bear market, during which Bitcoin’s value has plummeted from a mid-November high of more than $68,000 to around $20,100 Wednesday.

Celsius’ next bankruptcy hearing kicks off Thursday, and the company is accepting bids. Oct. 17 marks the final bid deadline, and a sale hearing is set for Nov. 1.

FTX founder Sam Bankman-Fried is eyeing Celsius’ assets, Bloomberg reported last week, just one day after the crypto billionaire won the bid for bankrupt lender Voyager’s assets with $1.422 billion.

Bankman-Fried took to Twitter on Sunday to clarify that, when bidding on assets, he aims to buy assets at a fair market price.

“[The] goal isn't to make money buying assets at cents on the dollar. It's to pay $1 on the $1 and get the $1 back to customers,” he tweeted. “If we were to get involved in Celsius, it would be the same.”