Celsius

United

David

Bitcoin

After navigating Chapter 11 bankruptcy proceedings in the United States, Celsius is gearing up for the distribution of $3 billion worth of cryptocurrency and fiat to creditors. 
Alongside this financial hassle, the company is venturing into a new domain by launching Ionic Digital, a Bitcoin mining firm. 
In a press release dated January 31, Celsius announced its bankruptcy exit strategy, which includes the establishment of Ionic Digital. This Bitcoin mining company will be managed by Hut 8 and led by Matt Prusak, Hut 8’s chief commercial officer. 
The creation of Ionic Digital is not merely a business venture, as it’s also a commitment to creditors. Celsius aims to “continue to deliver recoveries to creditors” through this initiative. Furthermore, the company intends for Ionic Digital’s stock to become publicly traded once it receives the necessary approvals. 
The bankruptcy exit plan gained overwhelming support from Celsius creditors, with approximately 98% of them backing the strategy. This comes after a hard period that began when Celsius paused withdrawals in June 2022 and subsequently filed for bankruptcy a month later. 
To obtain the amount available for distribution, Celsius converted altcoins to BTC or ETH and leveraged previous settlements, increasing the funds by approximately $250 million. 
As part of the winding-down process, Celsius will cease its operations and discontinue its mobile and web applications by February 28. Creditor distributions will be facilitated through PayPal, Venmo, and Coinbase. 
David Barse and Alan Carr, members of the special board overseeing Celsius through bankruptcy, emphasized the collaborative effort behind the company’s resurgence. “Our exit from bankruptcy is the culmination of an extraordinary team effort,” they said. 
Despite the challenges faced during its bankruptcy, Celsius settled significant fines with regulatory bodies, including the United States Federal Trade Commission, the Department of Justice, the Securities and Exchange Commission, and the Commodity Futures Trading Commission. 
Moreover, former CEO Alex Mashinsky faced legal troubles, including allegations of financial fraud, price manipulation, and misleading customers. However, Mashinsky has maintained his innocence, and his trial is scheduled for September. 
<h2 class="wp-block-heading" id="h-ftx-to-fully-repay-affected-users">FTX to Fully Repay Affected Users?</h2> 
In parallel developments, cryptocurrency exchange FTX is also navigating bankruptcy proceedings, with a focus on repaying customers in full. 
During a January 31 hearing in the United States Bankruptcy Court for the District of Delaware, FTX’s attorney, Andy Dietderich, outlined the exchange’s commitment to repaying users and creditors. While expressing cautious optimism about achieving full repayment, Dietderich clarified that this goal was an objective, not a guarantee, according to Cointelegraph. 
Contrary to speculation, there are no plans to relaunch FTX under its current Chapter 11 bankruptcy plan. Dietderich emphasized the absence of investors willing to finance a reboot or potential buyers for the exchange as a going concern. 
Dietderich also highlighted concerns about FTX’s previous management under CEO Sam Bankman-Fried, citing inadequate financial and company records regarding assets and employees. Notably, one of FTX’s arms, LedgerX, was deemed solvent during the bankruptcy proceedings. 
Bankman-Fried’s legal troubles, including multiple felony counts related to fraud at FTX and Alameda Research, have troubled the whole industry. His sentencing hearing is scheduled for March 28. 
It is worth noting that in December 2023, FTX debtors proposed reimbursement based on crypto asset prices at the time of bankruptcy, with Bitcoin valued at $16,871 and Ether at $1,258. However, creditors advocated for “in-kind” repayments for crypto holdings. Ultimately, Judge John Dorsey sided with the debtors, citing legal clarity on the matter. 
The post <a rel="nofollow" href="https://www.unlock-bc.com/117279/celsius-reinvents-bankruptcy-3b-repayment-ready-via-ionic-digital-will-ftx-follow/">Celsius Reinvents Bankruptcy: $3B Repayment Ready via Ionic Digital, Will FTX Follow?</a> appeared first on <a rel="nofollow" href="https://www.unlock-bc.com">UNLOCK Blockchain</a>.

Celsius Reinvents Bankruptcy: $3B Repayment Ready via Ionic Digital, Will FTX Follow?

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