After a protracted 18-month journey through the intricacies of bankruptcy proceedings, Celsius Network, a beleaguered crypto lender, has successfully concluded the distribution of assets exceeding $3 billion to its creditors.
The labyrinthine process of restructuring necessitated extensive collaboration with regulatory authorities, coupled with innovative approaches such as alternative settlement agreements and the conversion of less liquid altcoins into major cryptocurrencies like Bitcoin and Ethereum.
Majority Of Owed-Funds Account Holders Approve
A pivotal achievement for Celsius was securing nearly unanimous support for its distribution plan, with a staggering 98% approval from account holders who were owed funds. This meticulously crafted plan involved transferring over $3 billion in a combination of cryptocurrencies and traditional fiat currencies to the creditors, offering a semblance of relief after a prolonged and uncertain journey.
Notably, a new entity named Ionic Digital emerged from this process, dedicated to Bitcoin mining, with ownership distributed among creditors and operational management entrusted to the Canadian company Hut 8.
To expedite the timely distribution, Celsius recently liquidated a substantial portion of its Ethereum holdings. According to data from blockchain analytics firm Spot on Chain, around 67,500 ETH tokens, equivalent to $157 million, were deposited at Coinbase’s institutional trading division.
Lookonchain, an on-chain tracking platform, has evidence that indicates Celsius recently transferred 18,000 ETH tokens from their reserves to Coinbase. Taking into account the present trend in ETH prices, the transaction represented a transfer of around $40 million worth of the cryptocurrency.
In total, over 847,600 ETH, valued at nearly $2 billion, were transferred from various digital wallets to centralized trading platforms like Coinbase by the financially troubled company.
The strategic move to liquidate significant amounts of Ether and other cryptocurrencies directly on exchanges is poised to streamline the payout process for creditors eager to recover their funds expeditiously.
Celsius worked in close collaboration with federal and state regulatory bodies to ensure that the distributions adhered to full compliance standards. With the conclusion of distributions and the initiation of winding down operations, Celsius can finally draw the curtains on its tumultuous multi-year saga.
Company Kept Creditors’ Best Interests In Mind
Celsius’ Plan Administrator and former Chief Restructuring Officer, Chris Ferraro, commented on the development by saying that the company has kept creditors’ best interests in mind by maximizing value and speed throughout the process.
“Creating the best outcome for creditors by maximizing value and speed have been front of mind for Celsius throughout this process,” he said.
Looking ahead, the once-controversial Celsius mobile app and website, instrumental in its unique business model, will be permanently shut down. While creditors may not recoup the entirety of their owed sums, the thorough administration of the bankruptcy proceedings has left the majority satisfied—a noteworthy outcome given the precarious circumstances when withdrawals were abruptly halted in June 2022.
Armed with valuable lessons learned, the cryptocurrency industry as a whole can now pivot towards rebuilding trust among stakeholders and fostering a more resilient ecosystem.
Featured image from Getty Images, chart from TradingView
You can get bonuses upto $100 FREE BONUS when you:
💰 Install these recommended apps:
💲 SocialGood - 100% Crypto Back on Everyday Shopping
💲 xPortal - The DeFi For The Next Billion
💲 CryptoTab Browser - Lightweight, fast, and ready to mine!
💰 Register on these recommended exchanges:
🟡 Binance🟡 Bitfinex🟡 Bitmart🟡 Bittrex🟡 Bitget
🟡 CoinEx🟡 Crypto.com🟡 Gate.io🟡 Huobi🟡 Kucoin.
Comments