Some Celsius Account Holders Can Withdraw 72.5% of Their Claims
Beginning February 28, 2024, certain deposit account holders at Celsius will be able to withdraw 72.5% of their claims, according to a court document. Eligible users of the custody program can initiate withdrawals starting from November 29, subject to specific conditions specified by the court.
After filing for bankruptcy in July 2022, Celsius approved a settlement plan, distributing about $2 billion in Bitcoin and Ethereum, with a transition to a new company focused on crypto mining and staking.
Withdrawals Open at Celsius
Celsius, the cryptocurrency lender that filed for bankruptcy last summer, is beginning to open withdrawals for some of its users. According to a court document, users holding ‘Class 6A General Custody Claims’ and/or ‘Class 6B Withdrawable Custody Claims’ in the custody program can withdraw a portion of their funds starting today.
Eligible users will be able to withdraw 72.5% of their crypto assets, minus transaction fees. Those who rejected the reorganization plan will not participate in this distribution and their funds will be managed by the Litigation Administrator in a separate wallet for the next six months.
Some users have already tried to withdraw their funds and complained of having difficulties logging in, according to posts on X. It seems that Celsius users with a Facebook login ID are currently unable to access their account.
Exit from Bankruptcy and Reorganization Plan
Celsius filed for bankruptcy in July 2022, and in March 2023, a settlement plan was approved, allowing users to recover a portion of their funds in two payments during the year 2023. In September, creditors approved a reorganization plan that allowed the distribution of about $2 billion in Bitcoin and Ethereum. The new entity, managed by the Fahrenheit consortium, will focus on cryptocurrency mining and staking.
Celsius and its founder and former CEO, Alex Mashinsky, were also sued by the SEC, FTC, and CFTC this summer for misleading clients. Alex Mashinsky has also been accused of fraud. Celsius quickly reached an agreement with the FTC, agreeing to pay $4.7 billion after the conclusion of the bankruptcy proceeding, while Mashinsky’s criminal trial is expected to begin next year.