Celsius Network, the cryptocurrency platform that declared bankruptcy in July 2022, is striving to recover more than $2 billion withdrawn by major customers before the bankruptcy filing. An oversight committee formed during Celsius’s Chapter 11 proceedings is reaching out to customers who withdrew over $100,000 during the period preceding the bankruptcy to reclaim funds for creditors who didn’t withdraw. This effort impacts roughly 2% of Celsius users who withdrew around 40% of the platform’s assets before the bankruptcy.
The committee is offering these customers a settlement option with favourable terms to avoid potential litigation. Customers opting for settlement would have their liabilities calculated based on the value of their assets at the time of withdrawal, allowing them to retain any gains from crypto price increases since 2022. Those who decline the settlement offer might face higher liabilities through potential legal action, as warned by the committee.
In November, a bankruptcy judge approved Celsius’s plan to distribute assets and transform into a Bitcoin mining firm owned by creditors, with around $2 billion already distributed. The oversight committee is striving to recover over $2 billion in withdrawals through settlement options, aiming to expedite creditor repayment and mitigate litigation. Customers affected by this decision must choose between settling their potential liabilities or potentially facing legal consequences with more significant implications.
Currently, Celsius’s native token, CEL, is trading at $0.1862, reflecting a substantial year-to-date decline of over 49%. Shorter time frames indicate a lack of investor confidence, with a 12% decline in the last 24 hours, a 32% decline in the last week, and a 27% decline in the last fourteen days.