Celsius to Redistribute $2 Billion to Customers After Court Approval

Crypto lender Celsius Network has announced plans to repay its customers after obtaining approval by the U.S. Bankruptcy Court Southern District of New York on November 9.

Last month, the company reportedly sought court approval for its restructuring and repayment plan after getting approval from a majority of its creditors in September. With the latest grant, Celsius is able to initialize its plans in 2024, as reported by Celsius’ lawyer.

As part of the plan, $2 billion worth of Bitcoin (BTC) and Ethereum (ETH), and shares of its newly launched entity under Fahrenheit Group’s management, will be distributed to Celsius’ creditors. Additionally, Celsius plans to transform its business into a Bitcoin mining company owned by creditors.

Apart from the latest court approval, Celsius will also need to win an approval from the U.S. Securities and Exchange Commission (SEC). If the SEC rejects the proposal to create the crypto mining facility, the company might look for another option to repay its customers, including asset liquidation, according to the report.

The announcement came amid several charges targeting the crypto firm and its former CEO Alex Mashinsky.

Celsius Network is among the major crypto firms affected by the crash of LUNA/TerraUSD. The crypto lender filed for Chapter 11 bankruptcy protection in July 2022 after suspending withdrawals on its platform, claiming the market downturn.

In July 2023, Lookonchain noted that Celsius might start selling its altcoins, including LINK, SNX, BNB, 1INCH, ZRX, FTX, and BONE. It was previously estimated that the company held over $210 million worth of altcoins.