How Celsius Custody Cover holders can prepare for claims filing
On 13 June 2022 at 2:10am UTC, Celsius announced that they were halting all withdrawals, swaps, and transfers between accounts effective immediately. Celsius released a statement, which outlined the reasons for their decision to halt withdrawals:
Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, Swap, and transfers between accounts. We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations.
If you held an active Celsius Custody Cover on 13 June 2022 at 2:10am UTC, you’ll be able to file a claim starting on 12 September 2022 at 2:10am UTC.
Below is information about Custody Cover, the claims filing process, custodial proof of loss, and claims assessment.
Custody Cover
Custody Cover protects against a loss of funds for crypto assets that are held in a custodial account. Once Celsius announced that they were halting withdrawals, the 90-day provision in Section 1.2 took effect — members who held active cover when withdrawals were first halted have to wait for 90 days to pass before claims can be filed.
You can read the full Custody Cover wording or review the Custody Cover section in the Nexus Mutual documentation.
Claims Filing
On 12 September 2022 at 2:10am UTC, the 90-day period will have passed and you can start the claims process. You can check the Celsius Custody Covers List to see if your cover was active at the time withdrawals were halted.
If your Celsius Custody Cover is one of those listed above as eligible for claims filing, then you’ll be able to file a claim on or after 12 September 2022.
Nexus Mutual requires proof of loss for Custody Cover claims. You’ll need to provide off-chain proof of loss. When you file your claim, you should attach a copy of your account statement, which you can download as a CSV file from Celsius.
To download your CSV file, open your Celsius app and tap the Celsius logo in the bottom right, then select profile, then settings. Next, select download transaction history and your CSV file will be sent to your email address. You can then submit this document as proof of loss to show your current balance.
You can also include other types of proof of loss, which can include emails from Celsius regarding halted withdrawals, screenshots of withdrawal prevention messages, and other examples that demonstrate the amount of funds you’ve lost due to halted withdrawals.
When you are able to file your claim on Monday (12 September), you can head to the Nexus Mutual user interface and begin the process. If you have any issues, you can head to the Nexus Mutual Discord and share a message in the claims discussions channel.
If you’ve never filed a claim with Nexus Mutual before, you can read through the following section for an overview. And if you’re a member who would like to participate as a claims assessor, you can also read the following section.
Claims Assessment
You can file a claim up to two times; 10% of your cover cost is reserved for filing claims, as outlined in the diagram below.
Once your claim is submitted, Claims Assessors then review and assess the validity of your submitted claim. Any member can act as a Claims Assessor by staking NXM to participate in the claims voting process.
To become a Claims Assessor for the first time, a member can stake any amount of NXM for the initial staking period. When voting on a claim, the stake period is extended by the staking extension period (7 days). This means a claims assessor’s NXM will be staked for a minimum of 7 days; however, a member can only participate in claims assessment after NXM has been staked.
Should the assessor vote with the consensus outcome, this extension period is removed; should they vote against the consensus outcome, it remains in force.
When submitted, a claim first goes to the claims assessor group for voting. When voting on a claim, a claims assessor’s entire stake is applied to that claim as the voting weight. This is used to determine the voting outcome as well as determine the proportionate share of fee pool rewards, or the rewards claims assessors receive for voting honestly with the consensus.
The voting period lasts for a minimum of 36 hours. After this point the vote automatically ends on the earliest of either when:
- Voting stakes of greater than 10x the cover amount have voted; or
- 72 hours have passed.
The stake weighted voting outcome then determines the claim result. A claim is escalated to a full member vote if either:
- Voting consensus is below 70%; or
- Voting weight is less than 5x the Cover Amount.
You can read more about the claims assessment process in the Nexus Mutual documentation.
Join the claims assessment discussion in the Nexus Mutual Discord.
Review claims in the Nexus Mutual user interface.
What Prevents Claims Assessors from Denying My Claim?
The claims assessment process is designed like an optimistic oracle, but instead of code, humans act as the oracles. The system is designed so that any attack would put more capital at risk than any potential profit that could be gained or any capital staked in Risk Assessment that could be saved.
Read more about the advisory board’s role in the claims assessment process in the Nexus Mutual documentation.
You can also review the mutual’s claim history in the Nexus Mutual documentation and directly on-chain.
