Celsius Repays Creditors with $125 Million ETH Transfer
In an effort to repay its creditors, bankrupt lending firm Celsius has transferred over $125 million worth of Ether to crypto exchanges in the past week. This move follows similar actions by FTX and Alameda Research.
$125 Million ETH Transfer Details
Between January 8 and January 12, Celsius moved $95.5 million to Coinbase and $29.7 million to FalconX. Despite these transfers, Celsius still holds more than 550,000 ETH, valued at approximately $1.36 billion.
Celsius’ Preparations for Creditor Distributions
Ten days ago, Celsius announced the unstaking of 206,300 ETH, worth around $407 million, as part of its preparations for timely distributions to creditors. The firm filed for Chapter 11 bankruptcy in July 2022 and cited the need for liquidity to ensure asset distributions.
FTX and Alameda Research Follow Suit
FTX and Alameda Research, ventures by Sam Bankman-Fried, have also started moving funds to centralized exchanges. In the past week, they conducted transfers totaling $28.2 million in digital assets. They still hold around $1.2 billion in assets on the Ethereum Virtual Machine (EVM).
Celsius’ Audacious Plan to Recover Funds
Celsius proposed a measure targeting users who cashed out over $100,000 in the 90 days leading up to the bankruptcy declaration. These users were demanded to resolve their outstanding liability or face litigation. The goal was to recover funds through avoidance actions eligible for pursuit in court.
The Uncertain Success of Clawback Initiatives
Celsius’ plan to repay creditors and potentially allow users with trapped assets to receive their due share is uncertain. The success and influence of this unique clawback initiative are yet to be determined. If successful, it could set a precedent for struggling platforms attempting similar fund recovery measures.
Hot Take: Celsius Repays Creditors with $125 Million ETH Transfer
Celsius’ recent transfer of $125 million worth of Ether to crypto exchanges marks a significant step in its efforts to repay creditors. With FTX and Alameda Research also moving funds, the industry is witnessing a trend of bankrupt platforms taking action to address their financial obligations. While Celsius’ audacious plan involving clawback initiatives introduces uncertainty, it could pave the way for other struggling platforms seeking to recover funds from private investors. The success of these measures remains to be seen, but they represent important developments in the evolving landscape of crypto finance.
By
By
By