Celsius Restructures With Large Payouts and New Ventures Amid Bankruptcy

By: Eva Baxter

Bankrupt crypto lender Celsius Network has disbursed approximately $2.53 billion to 251,000 creditors, according to a court filing on August 26. This repayment, which started in January 2024, covers two-thirds of eligible creditors by number and about 93% of the total eligible value. The payment breakdown revealed that $1.43 billion was distributed via PayPal and Venmo, $917 million via Coinbase, and $178 million through cash transfers.

Celsius' bankruptcy plan involved distributing over $3 billion to more than 375,000 creditors across 165 countries. However, a significant number of creditors still have assets unclaimed. Specifically, 121,000 eligible creditors with an average distribution of $1,500 each have not yet claimed their distributions. Smaller sums appear less motivating for creditors to complete the required steps, as around 64,000 have distributions of less than $100, and 41,000 have amounts between $100 and $1,000.

The bankruptcy administrator stated that distributions via Coinbase would be retried every two weeks, while PayPal claim codes remain redeemable at all times. Cash distributions are attempted approximately once per week. Nonetheless, the plan administrator does not expect all creditors to claim their funds, meaning unclaimed amounts will eventually be redistributed to other creditors according to the reorganization plan.

Further complicating the scenario is Celsius's new venture under its reorganization plan: the establishment of Ionic Digital, a Bitcoin mining company. Earlier today, Ionic Digital announced that Building 1 at its Cedarvale, Texas facility is now live. This is the first of four planned 50-megawatt Bitcoin mining facilities on the site, accommodating 15,552 Bitcoin mining rigs. The Cedarvale site is expected to host approximately 66,000 miners powered by 215 megawatts of electricity, significantly boosting the company's total capacity from around seven exahash as of July 31, 2024. Ionic Digital's total Bitcoin holdings stood at 1,891.68 BTC at the end of July.

The future of Celsius appears to be multi-faceted, involving substantial repayments and innovative attempts to continue operation through digital mining ventures.