According to a bankruptcy judgment, holders of Celsius custody accounts might receive 72.5% of their cryptocurrency.
Customers of Celsius who choose to participate in the agreement are prohibited from “pursuing any lawsuit, including seeking relief from the automatic stay, turnover, or other claims or causes of action.”
A settlement proposal permitting custodial account holders to recover 72.5% of their cryptocurrency holdings has been authorized by the bankruptcy judge presiding over the bankruptcy case for cryptocurrency lending platform Celsius Network.
The deal granting Celsius custodial account holders the ability to receive 72.5% of their cryptocurrency claims if they approve of the settlement was approved by United States Bankruptcy Judge Martin Glenn in a hearing on March 21. The claimants are prohibited under the deal from “pursuing any litigation, including seeking relief from the automatic stay, turnover, or other claims or causes of action,” and The Debtors will have authority over any digital assets not covered by the settlement.
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The Celsius Custody settlement has been granted by the bankruptcy court. Customers will have the option not to. 30 days to review. Individuals who choose to participate will get 72.5% of their claim in two distributions: 36.25 per cent upfront and 36.25 per cent following plan resolution (or at end of the year).
By Cam Crews on March 21, 2023 (@camcrews).
The latest development in the case of the lending platform before the U.S. Bankruptcy Court for the Southern District of New York since it filed for Chapter 11 in July was the settlement between the committee of unsecured creditors, Celsius debtors, and an ad hoc group of account holders. In February, the defunct site revealed that NovaWulf Digital Management will serve as a sponsor for its restructuring plan, in which it was proposed that more than 85% of Celsius users would recover around 70% of their cryptocurrency.
In January, Judge Glenn handed down an order declaring that the lending platform was the rightful owner of more than $4 billion in cash through Celsius’ interest-bearing Earn program. However, a December ruling ordered the return of about $44 million in cryptocurrency to Celsius customers, and the judge approved the sale of $7.4 million worth of Bitmain coupons by Celsius debtors in February.
In the United States, bankruptcy cases for significant cryptocurrency companies are currently pending in courts during the 2022 market crisis, which is the current context for the failures of Signature, Silicon Valley, and Silvergate bank. On March 17, the debtors in the bankruptcy action involving the cryptocurrency exchange FTX revealed a $7 billion discrepancy between anticipated assets and claims.