Celsius' Bankruptcy Nears End as Creditors Approve Reorganization Plan

Most of the classes in the bankruptcy claim voted by more than 98% in favor of the reorganization.

AccessTimeIconSep 26, 2023 at 6:26 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Bankrupt crypto lender Celsius' creditors have voted to approve a plan that would return 67%-85% of holdings back to them, according to a voting declaration filing by restructuring specialist Stretto that awaits final approval from the court.

There have been objections to the plan, including from the U.S. Trustee. The U.S. Bankruptcy Court for the Southern District of New York will hold a confirmation hearing for final approval on Oct. 2. The Judge overseeing the case had approved the voting procedure in August 2023.

Most of the classes in the bankruptcy claim were passed by more than 98% votes in favor of the reorganization that would also see the sale of assets to crypto consortium Fahrenheit Holdings that includes Arrington Capital and miner U.S. Bitcoin Corp. Fahrenheit won a bid to acquire the insolvent lender Celsius Network in May 2023.

The overwhelming vote marks another step towards the end of Celsius' bankruptcy and the return of funds to customers. Celsius filed for bankruptcy in July last year as the crypto winter set in and its Chief Executive Officer Alex Mashinsky resigned as CEO in September 2022. In July 2023, Mashinsky was arrested on fraud charges and for manipulating the price of the CEL token, which he has denied.

As Mashinsky was arrested, Celsius made a $4.7 billion settlement with the U.S. over fraud allegations and said this would not affect reorganization plans. Mashinsky was later released on a $40 million bond, and a court recently ordered his banking and real estate assets frozen.

Jack Schickler contributed to reporting.

Edited by Parikshit Mishra.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.

Amitoj Singh

Amitoj Singh is a CoinDesk reporter.

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.