The native token of the Celsius Network experienced a remarkable increase of over 300% just a month after the company launched a $2.5 billion repayment initiative aimed at more than 250,000 creditors.
A court document dated August 26 revealed that the bankrupt cryptocurrency lender had reimbursed approximately $2.53 billion to around 251,000 creditors. According to data from Cointelegraph Markets Pro, the Celsius token (CEL) was trading at $0.16 at that time. By September 23, the token’s value had soared to $0.65, marking a 300% increase since the August filing. As of this writing, CEL is trading at about $0.58.
CEL 30-day price chart. Source: Cointelegraph Markets Pro
Despite this notable rebound, the token remains significantly lower than its peak, sitting at a staggering 1,287% below its all-time high of $8.05 recorded in June 2021.
Celsius repays creditors $2.5 billion
On August 26, Celsius managed to return roughly 84% of the assets it owed, amounting to $3 billion. While a substantial number of creditors have received their payments, not everyone eligible has opted to claim their digital assets, often due to the small amounts owed.
The filing disclosed that among the remaining creditors who have yet to retrieve their funds, 64,000 are due less than $100, while 41,000 are owed between $100 and $1,000 in digital currency. The report suggested that the minimal amounts owed might discourage these creditors from taking the necessary steps to claim their distributions. “They may not be incentivized to take the steps needed to successfully claim a distribution,” the filing noted.
The bankruptcy administrator also mentioned that it had already attempted over 2.7 million distributions for eligible creditors.
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The resolution of the Celsius bankruptcy saga
In July 2022, Celsius filed for bankruptcy, sending an email to its users indicating that it had initiated Chapter 11 reorganization proceedings. This announcement came shortly after the platform engaged lawyers with expertise in bankruptcy matters.
The bankruptcy proceedings resulted in fines reaching as high as $4.7 billion from the U.S. Federal Trade Commission. The company expressed satisfaction with the resolutions it reached with various regulatory bodies across the United States.
Additionally, Celsius’s former CEO, Alex Mashinsky, faced arrest by prosecutors and was charged with financial fraud, misleading customers, and manipulating the token’s market price.
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