Bankruptcy Judge: Celsius Account Holders Can Retrieve 72.5% of Crypto Holdings, Permitted They Opt-In to Settlement Plan
Custody account holders with the now-bankrupt crypto lender Celsius will be able to get back 72.5% of their holdings, as long as they agree to a settlement plan.
The settlement plan has now been approved by Judge Martin Glenn in the US Bankruptcy Court for the Southern District of New York, and was shared with the public in a court filing on Tuesday this week.
Custody account holders who choose to opt in to the plan will receive 72.5% of the crypto held in their custody accounts. The amount will be split into two pay-outs, with 36.25% paid up front and 36.25% upon resolution of the plan.
Details of the new settlement plan was shared by community members on Twitter, with one user who has covered the Celsius bankruptcy extensively noting that the plan is optional for account holders who now have 30 days to review it.
Those Custody members who wish to press for 100% may be subject to preference claims. Those who accept 72.5% settle these claims. Employees and insiders are ineligible for the Custody settlement.
— Cam Crews (@camcrews) March 21, 2023
There would be a second opportunity to opt-in upon plan approval.
By agreeing to the plan, creditors are not permitted to “pursue any litigation, including seeking relief from the automatic stay, turnover, or other claims or causes of action,” the filing said.
Important to note is that the new settlement plan only relates to custody account holders, and not account holders in the so-called Celsius Earn program. The plan also excludes Celsius’ employees and other insiders.
Celsius filed for bankruptcy during the height of the turmoil in the crypto market in July last year, and the filing at the time revealed a billion-dollar hole in the company’s balance sheet.
Celsius’ founder Alex Mashinsky resigned from his position as CEO of the company in September the same year.
