Celsius emerges from bankruptcy, begins repaying more than $3B to creditors
Celsius has emerged from Chapter 11 bankruptcy in the United States and is about to begin distributing $3 billion worth of crypto and fiat to creditors.
In a January 31 press release, the crypto lender announced the creation of a Bitcoin mining company, Ionic Digital, Inc., managed by crypto mining company Hut 8 and managed by Hut 8 Chief Commercial Officer Matt Prusak.
Celsius said Ionic Digital will continue to offer its refunds to creditors and that the stock is “expected to become publicly traded once the necessary approvals have been received.”
Celsius has now distributed more than $3 billion in cryptocurrency and fiat to creditors, settled claims with major stakeholders, and completed the previously announced MiningCo transaction to form a new Bitcoin mining company, Ionic Digital, Inc. , …
— Celsius (@CelsiusNetwork) February 1, 2024
More than 18 months after it ceased winding down in June 2022 and filed for bankruptcy a month later, 98% of Celsius' creditors have agreed to a bankruptcy exit plan.
Celsius added that it increased the amount of crypto distributed to lenders by $250 million by “converting altcoins to BTC or ETH and earlier settlements.”
In a court filing, Celsius said it would cease operations and discontinue its mobile and web apps by Feb. 28, creditor distributions through PayPal, Venmo and Coinbase — some creditors posted an X showing claim forms.
Lender distributions via PayPal, Venmo and Coinbase – Some lenders have posted a claim form in their respective apps on X.
#Celsius Lenders – 57.9% liquid crypto distribution
Sign in to your #PayPal account pic.twitter.com/zDKZvXTJai
— Simon Dixon (@SimonDixonTwitt) January 31, 2024
David Barsey and Alan Carr – members of the special board leading Celsius through bankruptcy, said: “Everyone assumed that Celsius would go bankrupt at the same time as other crypto lenders. “Our recovery from bankruptcy is the culmination of an extraordinary team effort.”
RELATED: Alex Mashinsky seeks dismissal of 2 lawsuits, asks court not to mention Celsius bankruptcy
When Celsius stopped issuing money, the company said it “puts it in a better position to celebrate” after the price of its generation token, Celsius (CL), plummeted earlier that year.
In its bankruptcy, Celsus saw a $4.7 billion fine with the Federal Trade Commission along with settlements reached with the Department of Justice, the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Former CEO Alex Mashinsky has been indicted by federal prosecutors on multiple counts of financial fraud, manipulating CEL prices and misleading Celsius customers. Mashinsky pleaded not guilty and is out on $40 million bond pending his trial in September.
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