Celsius announced in January that it has emerged from bankruptcy after 18 months and plans to return $3 billion to creditors. The company collapsed, fell into bankruptcy in 2022, and had to halt withdrawals. Life surely gives a second chance as Celsius created Ionic Digital, a Bitcoin mining company managed by Hut 8, aiming to generate additional recoveries for creditors.
This unique idea is part of its bankruptcy exit plan, and around 98 percent of the victims affected by the collapse have approved the bankruptcy exit plan.
It’s interesting to note that the distribution will be made through PayPal and Coinbase. To avoid any further loss or incident that can lead to a shutdown, the crypto lending company will not make the transfer to creditors through the debtor’s mobile or web app but distribute it through Paypal and Coinbase.
A more detailed breakdown of the collapse and bankruptcy shows that, apart from the cash, creditors will get a stake in the newly launched mining operation. The process of returning the money was stamped after Celsius made a $4.7 billion settlement with U.S. authorities over fraud allegations.
The victim’s time and funds might have been delayed, but they might be getting more interest in the form of incentives from this bankruptcy.
We have seen crypto lenders disappear when they get into trouble, collapse, or become bankrupt. However, Celsius is not running away from the race. The company has settled its differences with the U.S. Department of Justice, Securities and Exchange Commission, and Commodity Futures Trading Commission and negotiated a deal with creditors to bring back smiles on their faces.
According to Celsius in a statement, the app will shut down on or around February 28th. Ensuring that justice is done for the manipulations by the past CEO, Alex Mashinksly, who is still denying the allegations of fraud charges for allegedly manipulating the price of the lender’s CEL token. His trial won’t be forgotten or forgiven even after paying a $40 million bond and giving the court the right to freeze his banking and real estate assets, as it is scheduled to take place in September 2024.
The debtors are being watched as they return the creditors’ funds. Therefore, the story continues.
