Celsius, the bankrupt crypto lending platform, has announced that it will distribute an additional $127 million to its creditors.
This marks the second payout from its estate since its collapse. The payment will be funded through the “Litigation Recovery Account” and available to creditors in classes 2, 5, 7, 8, and 9.
Celsius will soon begin a second distribution of $127 million made available from the Litigation Recovery Account to eligible creditors (Classes 2, 5, 7, 8, and 9). Distributions will be made in BTC or USD, based on eligibility. For more details, please refer to this notice:…
— Celsius (@CelsiusNetwork) November 27, 2024
The creditor classes eligible for distribution include retail borrower depositors, participants in the “Earn” program, and individuals with unsecured or withheld claims. Notably, this distribution excludes those with convenience claims and individuals without the right to illiquid recovery.
A Notice of Commencement filed on November 27 in the U.S. Bankruptcy Court for the Southern District of New York outlined the distribution process in detail. Creditors will receive payouts using the same methods used: PayPal, Venmo, or Coinbase. Cash payments will be available for those without verified accounts on these platforms. Additionally, corporate creditors who do not have convenience claims will also qualify for this distribution.
While the payout is a step forward in the long recovery process, many creditors have expressed dissatisfaction with the distributed amount. On social media platform X, some users voiced their frustrations, with one Bitcoin investor, Puffel, stating,
“I didn’t receive anything till now because of clawback shit. I did nothing wrong. I’m no insider. I just withdrew my ETH several weeks before Celsius went down. You guys stole me 0,7 BTC and a bunch other tokens! Give it back to me”!
Another user, JCH, complained about their payment, calling it “peanuts” compared to their losses.
In September 2024, Celsius made a $2.5 billion payment to over 250,000 creditors, leading to a remarkable 300% surge in its native token, CEL. According to Coingecko, CEL’s price increased from $0.16 on August 26, 2024, to $0.56 by September 23, 2024, raising its market capitalization to $12.74 million.
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