Celsius Network Plans to Retrieve $2 Billion in Funds
A recent Bloomberg report shared insights on crypto lender Celsius Network’s endeavor to retrieve funds from its major customers who withdrew their assets before the platform’s collapse in 2022.
Restructuring Plan for Fund Reimbursement
According to the report, the committee’s initiative is part of the company’s larger restructuring plan that facilitates the distribution of customer and creditor funds. In the latest development, Celsius targets the prime customers who withdrew more than $100,000 during the company’s critical period to claw back over $2 billion.
Celsius Emerges from Bankruptcy
On January 31, 2024, Celsius reportedly emerged from bankruptcy, commencing the redistribution of customer funds. The platform initiated the $3 billion reimbursement plan, which was approved by 98% of the customers and the Bankruptcy Court for the Southern District of New York. The Plan Administrator Chris Ferraro posited,
Creating the best outcome for creditors by maximizing value and speed have been front of mind for Celsius throughout this process. Today, over 18 months after Celsius paused withdrawals, we began distributing over $3 billion of cryptocurrency, fiat, and stock in Ionic Digital to Celsius creditors.
The company intends to use the potential returned funds to reimburse the funds of those customers who failed to withdraw their funds on time. However, the plan is expected to affect at least 2% of the Celsius customers who collectively withdrew 40% of the company’s assets.
The report stated that the company has started contacting the customers directly to discuss the deal. In addition, the company stated that the affected customers would be offered to settle at a “favorable rate” to avoid potential litigation.
Celsius reportedly appointed a Litigation Administrator who will focus on select customers who collectively withdrew about $2 billion during the Preference Period. Preference Period is the term used to describe the 90 days before Celsius’ collapse.
Disclaimer
The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
