Celsius Network, the crypto lender that filed for Chapter 11 bankruptcy in July 2022, is seeking court approval on a final restructuring plan, according to a Monday report from Bloomberg.
#Celsius will distribute at least $2.03B of crypto to Creditors.
Meanwhile, NewCo will be seeded with up to $450 million in crypto.
— Celsius NewCo Community (@CelsiusNewCo) October 2, 2023
The plan would distribute $2 billion worth of Ethereum (ETH) and Bitcoin (BTC) to creditors before the end of 2023, and seed its new creditor-owned entity NewCo with $450 million. The new company will also have financial backing from a consortium named Fahrenheit and will restart Celsius’ crypto mining business.
“Fahrenheit believes in the business. They are putting their money where their mouth is,” said Celsius lawyer Christopher S. Koenig in a bankruptcy hearing on Monday.
In August, Judge Martin Glenn granted Celsius permission to gather votes from creditors on its proposed restructuring plan. Last week, a voting declaration filing showed that more than 98% of creditors approved the plan.
However, some major creditor groups are still opposed to the plan, including an affiliate of Lantern Ventures that claims it is owed $82 million from Celsius, and argues that the new business has been overvalued.
Meanwhile, former Celsius CEO Alex Mashinsky, who resigned when the company filed for bankruptcy, has been charged with wire fraud and other crimes by US regulators. The U.S. Securities and Exchange Commission (SEC), the U.S. Department of Justice (DOJ) and the Federal Trade Commission (FTC) have all filed lawsuits against the former Celsius CEO, who has pleaded not guilty to all charges.