Celsius Bankruptcy Plan Approved
The bankruptcy court has approved Celsius’ plan to distribute around $2 billion worth of Bitcoin and Ether to creditors. In addition, creditors will also obtain shares in a reorganized company known as NewCo under the approved plan. The company plans to start reimbursements by the end of the year.
Celsius customers will also get a partial repayment of the crypto assets deposited on the platform. When filing for bankruptcy, Celsius had around 600,000 customers with around $4.4 billion held in interest-bearing accounts.
The bankruptcy restructuring plan also has a settlement valuing Celsius’ CEL token at 25 cents. Earlier this year, the bankrupt crypto lender was accused of inflating the value of CEL to benefit insiders.
Celsius Reorganizes As NewCo
NewCo will be under the management of Fahrenheit LLC, a consortium of crypto-native individuals and firms like Arrington Capital. The consortium will mine new Bitcoin and monetize Celsius’ illiquid assets.
Arrington Capital told Reuters that they are eager to make things whole for creditors and will purchase a $50 million minority stake in the reorganized company, which will list on Nasdaq. Listing will allow Celsius’ customers to sell equity shares obtained as part of the bankruptcy recovery process.
The reorganized NewCo will also pursue charges against Celsius’ founder, Alex Mashinsky, who is facing criminal charges in the US and a civil lawsuit in New York.
Hot Take: Celsius Bankruptcy Recovery Plan Moves Forward
Celsius Network’s bankruptcy recovery plan has been approved by the court, paving the way for creditors to receive their share of Bitcoin and Ether. The reorganized company, NewCo, under the management of Fahrenheit LLC and supported by Arrington Capital, aims to reimburse creditors and pursue legal action against its founder. This marks a significant step towards resolving the long and costly process for Celsius creditors.
By
By
By
By