Chainalysis Finds Little Support for Celsius Claims as Audit Lawsuit Proceeds

A US federal judge has struck down most of the claims Celsius Network’s estate brought against blockchain analytics firm Chainalysis, but allowed a key allegation to move forward. In a ruling issued Tuesday, US District Judge Margaret Garnett denied Chainalysis’ motion to dismiss one aiding-and-abetting claim tied to a 2020 Celsius “audit” announcement.

The lawsuit is part of the bankruptcy estate’s broader effort to recover assets for creditors after Celsius froze withdrawals in mid-2022, leaving customers unable to access about $4.7 billion. The surviving claim centers on whether Chainalysis knew certain statements in Celsius’ press release were false or misleading and still helped disseminate them.

Key takeaways

• Judge Margaret Garnett dismissed 12 claims against Chainalysis with prejudice, meaning they cannot be refiled in this case.
• Three consumer-protection claims were dismissed without prejudice, giving plaintiffs until Oct. 20 to amend them or withdraw them.
• The court allowed a single aiding-and-abetting claim to proceed, based on allegations that Chainalysis knew a 2020 release contained false statements.
• The case is being pursued by the Celsius litigation administrator, BRIC, as part of the estate’s effort to recover funds after Celsius’ 2022 bankruptcy.

Aiding-and-abetting claim survives

According to the court’s summary of the complaint, the judge concluded that the remaining claim plausibly alleged Chainalysis’ involvement in helping to publish allegedly inaccurate statements. Judge Garnett denied Chainalysis’ bid to dismiss the aiding-and-abetting theory.

The court’s reasoning, as described in the filing referenced by Justia, focused on whether the complaint sufficiently alleged that Chainalysis was aware that a 2020 Celsius press release included false statements, and that Chainalysis helped disseminate them. The judge found that the complaint met the threshold required to keep that particular claim alive.

Chainalysis told Cointelegraph it was unable to comment. Celsius’ litigation administrator had not responded before publication.

Bankruptcy backdrop and recovery effort

Celsius, a crypto lender, filed for Chapter 11 bankruptcy in July 2022 amid the market downturn. The company halted customer withdrawals a month earlier, locking customers out of funds that were later estimated at roughly $4.7 billion.

In this context, the Chainalysis lawsuit is part of the Celsius estate’s attempts to pursue legal claims against entities it believes may have contributed to losses suffered by customers. The bankruptcy administrator seeks to recover value for creditors and some former customers by asserting wrongdoing tied to the company’s communications and financial representations.

The case was brought by the Blockchain Recovery Investment Consortium (BRIC), which acts as litigation administrator and recovery manager for the Celsius estate. In addition to pursuing claims against other parties, BRIC has sought to advance causes of action on behalf of Celsius and certain former customers.

The 2020 “audit” and the disputed $3.3 billion figure

The core of the dispute traces to a 2020 effort by Celsius to quantify assets backing its operations. The complaint alleges that Celsius enlisted Chainalysis to help calculate assets under management using Chainalysis’ Reactor software.

As the court’s summary reflects, an initial calculation by a Celsius executive reportedly produced about $1.18 billion in assets using Reactor. The methodology was later changed, and the figure was reportedly increased to roughly $3.3 billion.

On Dec. 9, 2020, Celsius issued a press release announcing an “audit” confirming approximately $3.3 billion in assets, stating that Chainalysis Reactor was used to analyze transactions, total deposits, and total withdrawals since Celsius launched its service in 2018. The release portrayed the work as an “audit” and described it as independent verification.

The complaint alleges that Chainalysis helped draft, edit, and approve the press release. It further contends that Chainalysis knew the statements describing the work as an “audit” and as “independent verification” were false or materially misleading.

Chainalysis attempted to have the complaint dismissed in its entirety, but Tuesday’s ruling indicates that at least some aspects of the alleged conduct are sufficiently pleaded to proceed to the next stages of litigation.

What the ruling changes—and what remains open

While the court dismissed the majority of claims, the fact that one aiding-and-abetting claim survived can still be consequential. A case that advances on even a single theory can drive further discovery into what Chainalysis knew at the time, what it communicated to Celsius, and how it contributed to the preparation and approval of the 2020 release.

At the same time, the dismissal of 12 claims with prejudice narrows the estate’s potential paths in this specific action, making the surviving claim the focal point for continued litigation. The three consumer-protection claims, dismissed without prejudice, are another watch item: plaintiffs have until Oct. 20 to amend them or indicate they will not do so.

For investors, builders, and market participants, the case highlights a recurring tension in crypto finance: how “audits,” “independent verification,” and third-party analytics are described publicly, and what level of responsibility third parties may face when their tools and outputs are used in marketing or disclosures—particularly when those representations are later challenged.

As the Celsius estate presses forward on the surviving aiding-and-abetting theory, the next developments to monitor are whether the plaintiffs amend any of the consumer-protection claims by Oct. 20 and how the court handles evidence around what Chainalysis knew and how it participated in the 2020 communications.