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The Celsius Network’s native token, CEL, witnessed an impressive price surge of over 300% just a month after the bankrupt crypto lender began a massive repayment program. This comes in the wake of the company’s efforts to return billions to creditors following its 2022 bankruptcy filing.
A 300% Price Spike – CEL’s Rollercoaster Comeback
According to a court filing on August 26, Celsius has successfully repaid $2.53 billion to around 251,000 creditors. Cointelegraph Markets Pro reported that CEL traded at $0.16 around this time. Fast forward to September 23, and the token’s price skyrocketed to $0.65—a remarkable 300% rise in less than a month. However, despite this recovery, CEL remains 1,287% below its all-time high of $8.05 set in June 2021. At the time of writing, CEL is trading at around $0.58.
Massive Repayments, but Many Creditors Remain Unpaid
The repayment scheme appears to be the driving force behind the surge in CEL’s value. On August 26, Celsius had repaid 84% of the assets owed to creditors, totaling $3 billion. While the majority of creditors have already been compensated, not all have come forward to claim their funds.
The court filing indicated that a significant number of creditors have been slow to claim their digital assets, largely due to the relatively small amounts owed. Of the 64,000 creditors yet to claim their funds, many are owed less than $100, while 41,000 are due between $100 and $1,000 in crypto. The report suggests that these smaller amounts may not be enough to incentivize creditors to go through the steps required to recover their assets.
The bankruptcy administrator has already attempted 2.7 million distributions, but a full resolution remains out of reach for some.
Bankruptcy Fallout – A Costly End To Celsius’ Chapter
Celsius Network’s bankruptcy saga began in July 2022 when the company filed for Chapter 11 reorganization. This came just days after the lender sought legal assistance to handle its spiraling financial crisis. The case led to a significant legal battle, with Celsius facing penalties as high as $4.7 billion from the United States Federal Trade Commission.
Despite the legal challenges, Celsius has made progress toward regulatory resolutions, according to company statements. Still, the controversies continue to loom large over the platform. Former CEO Alex Mashinsky was arrested and charged with financial fraud, accused of misleading customers and manipulating CEL’s price.
Also Read: Celsius Distributes $2.5 Billion To 251,000 Creditors – 93% Of Funds Released Amid Controversy
Celsius’ massive creditor repayments have undoubtedly played a role in reviving CEL’s price, but the road ahead remains uncertain. While the token’s value has shown signs of recovery, the legal and financial baggage surrounding the company may continue to weigh down its long-term prospects. Nonetheless, the 300% surge offers a glimmer of hope for CEL holders as Celsius attempts to close this tumultuous chapter.
As the company works through its restructuring, the crypto community will be watching closely to see whether CEL’s comeback can sustain itself or if it will falter under the weight of its past.
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.
Crypto and blockchain enthusiast.
