Celsius Network, once a titan in the cryptocurrency world, has begun distributing $2.5 billion to creditors as part of its bankruptcy restructuring plan. This long-awaited move comes after the company declared bankruptcy in 2022, following the market crash triggered by the collapse of the Terra Luna ecosystem. However, while some creditors have welcomed the payments, the process has sparked controversy and frustration among many.
A Rocky Road To Recovery
After exiting Chapter 11 bankruptcy in February 2024, Celsius embarked on a massive reorganization plan. The firm promised to distribute over $3 billion in cryptocurrency and fiat to creditors, using platforms like Coinbase and PayPal. As of now, more than $2.53 billion has been distributed to approximately 251,000 creditors, representing about 93% of the total value based on January 2024 prices.
However, the road to recovery has been anything but smooth. The first round of payouts began in January, with $1.7 billion (or 65%) distributed within the first two weeks. By February, that figure had risen to nearly $2 billion, or around 80%. Yet, despite this progress, nearly 121,000 creditors have yet to claim their payouts, with an average claim size of approximately $1,500. Among these, about 64,000 are owed less than $100 each, while another 41,000 have claims ranging from $100 to $1,000.
Delays and Dissatisfaction
As the process drags on, about 12,000 creditors are still waiting for their share. The bankruptcy administrator cites two main reasons for these delays: some claims have been held back, while others lack essential information needed to process payments. These hold-ups have led to growing frustration among creditors, many of whom have voiced their dissatisfaction online.
One user shared their ordeal on Reddit, stating, “I have still been under manual review on Coinbase for 9 months now. Countless documents and emails, and yet still no verification. They have not even responded to my last email for a month. I guess I am going to have to ask for a wire transfer.” This sentiment is echoed by others who have found the distribution process to be overly complicated and lacking in transparency.
Also Read: Celsius Distributes $2.53 Billion to Creditors – 93% of Claims Paid, But Challenges Remain
The End in Sight?
Despite the ongoing issues, the bankruptcy proceedings may be nearing an end. With only a handful of distributions left, Celsius is under pressure to resolve the remaining claims swiftly. However, the controversies surrounding the process have left a sour taste in the mouths of many creditors, casting a shadow over what should have been a moment of relief.
As Celsius attempts to close this chapter, the lessons learned from its collapse and subsequent recovery will undoubtedly resonate across the cryptocurrency industry. For now, creditors continue to wait, hoping that their long-awaited payouts will finally be delivered.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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