Celsius repays two-thirds of its creditors
Celsius has repaid $2.53B to 251,000 creditors, covering 84% of the debt.
121,000 creditors still haven’t claimed their funds, many due small amounts.
Former CEO Alex Mashinsky faces fraud charges, with $4.7B in fines settled.
In a significant development amid its ongoing bankruptcy proceedings, Celsius, the embattled crypto lender, has successfully repaid approximately $2.53 billion to 251,000 creditors according to a Monday court filing. This repayment represents roughly 84% of the total $3 billion owed to over 375,000 creditors.
The distribution marks a crucial milestone in the company’s attempt to resolve its financial turmoil following its filing for bankruptcy in July 2022.
Celsius implements a routine distribution process
The repayment process, which has seen two-thirds of eligible customers compensated, is seen as a positive sign for the broader crypto industry.
This progress aligns with the recovery efforts of other major crypto entities, such as the Mt. Gox exchange, which is also in the midst of its bankruptcy proceedings.
Mt. Gox, having owed over $9.4 billion to 127,000 creditors, is beginning to return assets after a decade-long wait.
Despite the notable advancement, not all creditors have actively pursued their funds. Out of the 121,000 creditors who have yet to claim their money, a substantial portion is owed relatively small amounts.
Specifically, around 64,000 creditors are owed less than $100, and 41,000 are due between $100 and $1,000. This situation has led to a lower incentive for these creditors to claim their funds, given the minimal amounts involved.
To address this, the Celsius bankruptcy administrator has implemented a routine distribution process. Attempts to distribute the remaining funds are made bi-weekly via Coinbase, and PayPal claim codes remain available for redemption at any time.
To date, more than 2.7 million distribution attempts have been made for the approximately 372,000 currently eligible creditors.
Repayments come amid legal actions
The Celsius bankruptcy saga has also seen significant legal and regulatory actions. The company settled $4.7 billion in fines with various US agencies, including the Federal Trade Commission and the Securities and Exchange Commission.
Additionally, former CEO Alex Mashinsky faces federal charges of financial fraud and price manipulation, though he maintains a plea of not guilty and is out on a $40 million bond, awaiting trial.
As Celsius continues its efforts to repay creditors and resolve its financial issues, these developments offer a glimpse of resolution in the troubled world of cryptocurrency lending.
The post Celsius repays two-thirds of its creditors appeared first on CoinJournal.
