February 2, 2024

Celsius Network Successfully Emerges from Bankruptcy, Announcing $3 Billion Payout to Creditors

Celsius Network, a prominent player in the cryptocurrency lending space, has officially concluded its bankruptcy proceedings, achieving a remarkable turnaround.

Celsius Network, a leading cryptocurrency lending platform, has reached a significant milestone by successfully concluding its bankruptcy proceedings. In a statement, the company announced its intent to disburse more than $3 billion to its creditors. As part of this resolution, creditors will also receive a stake in the newly established Ionic Digital Inc. mining operation, set to go public pending the necessary regulatory approvals.

The journey to recovery for Celsius Network has been arduous, yet the positive outcome has brought relief to many stakeholders. David Barse and Alan Carr, members of the special board committee overseeing the bankruptcy, expressed satisfaction with the results. They acknowledged the doubts surrounding Celsius's survival when they were appointed in June 2022 but highlighted their successful efforts to safeguard the platform’s cryptocurrency holdings, negotiate with creditors, and restructure operational components.

A pivotal aspect of Celsius Network's path through bankruptcy involved addressing legal challenges. The company successfully settled cases with various U.S. regulatory authorities, including the Department of Justice, the Securities and Exchange Commission, and the Commodity Futures Trading Commission. These settlements played a crucial role in paving the way for the company's resurgence from bankruptcy.

With the bankruptcy process now concluded, Celsius Network is eagerly looking ahead. Matt Prusak, the Chief Commercial Officer of Hut 8, the company overseeing Ionic’s mining operations, has been appointed as Ionic’s CEO. This appointment signals a significant move for the company as it transitions into its next phase.

In a separate announcement, Celsius Network disclosed its distribution plans for cryptocurrencies. The platforms chosen for this task are PayPal and Coinbase, which will be responsible for distributing digital assets to creditors. Notably, these assets will not be distributed through Celsius's mobile or web applications, as these platforms are set to be deactivated around February 28.

During its bankruptcy, Celsius Network made headlines with a $4.7 billion settlement with U.S. authorities over fraud allegations. The allegations centered around former CEO Alex Mashinsky, who resigned in September 2022. Mashinsky was arrested on fraud charges related to manipulating the price of the lender’s CEL token. Despite vehemently denying these allegations, Mashinsky was released on a $40 million bond. His banking and real estate assets have been frozen, and his trial is scheduled for September 2024.

Stay Connected
Join the conversation on 𝕏
Make a Difference
Support our content creators
and help us stay ad-free
BTC: bc1q6nt2u2u539kjgfn5hj8g9f8xk2hnwuudlrlnr9
Cryptocurrency news & learning platform
All Rights Reserved © 2024