The distribution will be done via Coinbase and PayPal.
When Celsius’s bankruptcy is officially declared over, more than $3 billion will be distributed to creditors.
In addition to the money, creditors will receive stock in the recently established mining business of Ionic Digital Inc., the company announced in a statement on Wednesday. After 18 months of bankruptcy court proceedings, around 98% of Celsius Network’s creditors approved the deal. Ionic anticipates going public after obtaining all necessary clearances.
Members of the special board committee that oversaw the bankruptcy, David Barse and Alan Carr, stated in a statement that “everyone assumed Celsius would disappear completely like the other crypto lenders that were filing bankruptcy around the same time when we were appointed in June 2022.”
They claimed to have successfully negotiated a settlement with creditors, secured the platform’s cryptocurrencies, reorganized the portion of the business that might continue, and resolved legal disputes with the Securities and Exchange Commission, the Commodity Futures Trading Commission, and the U.S. Department of Justice.
Matt Prusak is now the CEO of Ionic; according to Celsius, Celsius creditors will own Ionic Digital; and Hut 8 Corp. (Nasdaq | TSX: HUT) (“Hut 8”) will be in charge of its mining operations. It is anticipated that Ionic Digital will go public after it has all the required approvals.
The company stated that Coinbase and PayPal will be handling the cryptocurrency distribution in a different filing. The debtors’ online and mobile applications will be discontinued on or around February 28. Celsius will not make any distributions through these platforms.
Along with filing for bankruptcy, cryptocurrency lender Celsius settled fraud charges with US authorities for $4.7 billion. After leaving the company in September 2022, former CEO Alex Mashinsky was detained on fraud charges for allegedly manipulating the value of the lender’s CEL token, a claim he has refuted.
The court barred Mashinsky’s real estate and bank accounts before releasing him on a $40 million bond. The date of his trial is set for September 2024.