celsius

#Write2Earn According to the court filing, around 20,500 Bitcoins and 301,000 Ether tokens have been distributed among eligible creditors, without any security or operational issues
Bankrupt cryptocurrency lender #Celsius has announced that most eligible creditors have now collected their liquid crypto distributions from its two distribution agents, payments giant PayPal, and crypto #exchange Coinbase.
In a recent court filing, Kirkland & Ellis, the legal team representing Celsius, provided an update on the creditor distributions as outlined in the restructuring plan. This follows Celsius' announcement last week that it exited from bankruptcy, which was filed in July 2022.
According to Kirkland & Ellis, crypto distributions to holders in the United States are facilitated through PayPal, while overseas holders are managed by Coinbase as the distribution agent.
The lawyers declared that $2 billion worth of crypto has been transferred to creditors, including 20,255.66 Bitcoin
#BTC
$51,956
and 301,338.77 Ethereum
$ETH
$2,790
“As of the date hereof, a significant number of Holders have successfully collected their Liquid Cryptocurrency from PayPal/Venmo and Coinbase: Nearly 75% of the $BTC /ETH set to be distributed by PayPal/Venmo and through Coinbase has already been collected.”
However, the filing explained that account holders who did not agree to the restructuring plan will not receive any crypto distribution, until their individual claims are resolved.
Additionally, it mentioned that certain account holders might face challenges in receiving their distribution if Coinbase or PayPal flag any anti-money laundering (AML) or compliance issues.
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“Distribution Agents have discretion to refuse making distributions to anyone they believe does not fulfill their compliance and other requirements," the filing stated.
Post-effective date Celsius debtors' first update on distributions. Source: Stretto
There has been speculation within the crypto industry about how the actions in the restructuring plan might affect the broader crypto market.
On Jan. 5, @WISE PUMPS reported that Celsius started recalling and rebalancing its crypto assets to ensure a timely distributions to creditors.
However, blockchain analytics firm Nansen highlighted at the time, that almost a third of the ETH in the pending withdrawal queue currently belongs to Celsius.
In October 2023, Celsius asked the court to approve of its restructuring plan, hoping to have creditors repaid before the end of 2023.
Meanwhile, Alex Mashinsky, the former CEO of the now-defunct crypto lender, is scheduled for trial in September 2024 regarding Celsius' collapse.
However, his legal team has recently faced scrutiny for a potential conflict of interest, as they also represent Sam Bankman-Fried, the former CEO of bankrupt crypto exchange FTX.
On Feb. 6, U.S. Prosecutors raised concerns about lawyers Marc Mukasey and Torrey Young, who have both filed notice of appearances in the criminal cases against the former crypto CEOs.
@WISE PUMPS recently reported that the U.S. government called for a Curcio hearing, in which the judges may ask questions about a potential conflict of interest and why both lawyers were involved in Bankman-Fried and Mashinsky’s cases.
Magazine: GBTC drops BTC stake by 21%, Celsius exits bankruptcy, and more: Hodler’s Digest, Jan. 28 – Feb. 3#TrendingTopic

Breaking news 📢📢
Alex Mashinsky, the former CEO of Celsius, has agreed to relinquish all claims to the assets of the bankrupt crypto lender, facilitating further distributions to creditors. This agreement, submitted to the U.S. Bankruptcy Court for the Southern District of New York, bars Mashinsky and three associated entities from receiving any bankruptcy proceeds. All claims made by Mashinsky will be withdrawn and will not receive any distribution under the Chapter 11 plan. Consequently, he and his related entities will be permanently excluded from any recovery in the Celsius bankruptcy, allowing the reserved assets to be redistributed to other creditors. The court will maintain oversight of the distribution process while Mashinsky serves a 12-year prison sentence for defrauding customers and manipulating the CEL token's price. Celsius filed for Chapter 11 in July 2022 due to a liquidity crisis and has since transitioned to a recovery-focused entity, distributing over $2.5 billion to around 251,000 creditors by August 2024.

Alex Mashinsky, the founder and former CEO of the cryptocurrency lending platform Celsius Network, has been sentenced to 12 years in federal prison for orchestrating a multi-billion-dollar fraud scheme that misled investors and manipulated the market.
🏦 What Happened?
Mashinsky launched Celsius in 2017, promoting it as a safe, high-yield alternative to traditional banking. The platform attracted over $25 billion in customer assets by offering interest rates as high as 18.6% on crypto deposits. However, in July 2022, Celsius collapsed, freezing $4.7 billion in customer funds and revealing a $1.2 billion financial gap.
In December 2024, former Celsius CEO Alex Mashinsky pleaded guilty to securities fraud and commodities fraud. He admitted to:
1 Misleading customers about the financial health of Celsius and the safety of their investments.
2 Using customer funds for high-risk investments without proper disclosure.
3 Manipulating the price of Celsius’s native token (CEL) by orchestrating large-scale purchases to inflate its value, while secretly selling his own holdings for personal gain.
On May 8, 2025, U.S. District Judge John G. Koeltl sentenced Mashinsky to 12 years in federal prison. Prosecutors had sought a 20-year sentence, emphasizing the deliberate and deceptive nature of his actions and his lack of remorse. The judge noted that the fraud was the result of deliberate decisions rather than market conditions or negligence.
📉 The Fallout
The collapse of Celsius left many investors, including retail customers, with significant losses. At its peak, Celsius managed over $25 billion in assets, but its bankruptcy in 2022 left a substantial financial gap, with only about 60% of customer funds partially recovered.
Do you think 12 years is enough for crypto fraud on this scale?
#crypto #newscrypto #Fraud_alert #Celsius #AlexMashinsky