Celsius Emerges from Chapter 11 and Commences Distributions of Over $3 Billion of Cryptocurrency to Creditors
Celsius Network LLC has successfully emerged from bankruptcy and is now distributing over $3 billion of cryptocurrency and fiat to its creditors. Additionally, a new Bitcoin mining company called Ionic Digital, Inc. has been created and will be owned by Celsius' creditors.
Celsius Emerges from Chapter 11
Celsius Network LLC has announced that it has completed its reorganization plan and has successfully emerged from bankruptcy. The plan, which was approved by approximately 98% of the company's account holders, includes the distribution of over $3 billion of cryptocurrency and fiat to Celsius' creditors.
The company has spent the past eighteen months resolving legal issues, cooperating with regulatory investigations, and building consensus among stakeholders. The Bankruptcy Court for the Southern District of New York confirmed the plan on November 9, 2023.
One significant outcome of the reorganization plan is the creation of a new Bitcoin mining company called Ionic Digital, Inc. This company will be owned by Celsius' creditors and will have its mining operations managed by Hut 8 Corp.
Distributions to Creditors and Creation of Ionic Digital
Following the confirmation of the reorganization plan, Celsius has commenced distributions of over $3 billion of liquid cryptocurrency and fiat to its creditors. This distribution is a significant step in maximizing value and speed for the company's creditors.
Ionic Digital, Inc. is the new Bitcoin mining company that has been created as part of the reorganization plan. The company's stock is expected to be publicly traded once it receives the necessary approvals. Celsius' creditors will own equity in Ionic Digital in the form of common stock.
Chris Ferraro, Plan Administrator and former Chief Restructuring Officer, Interim CEO, and CFO of Celsius, stated that the distribution of cryptocurrency, fiat, and stock in Ionic Digital is a major milestone for the company.
Successful Chapter 11 Process
The successful emergence from bankruptcy is the result of an extraordinary team effort and collaboration between Celsius, Hut 8, strategic partners, and the company's creditors. David Barse and Alan Carr, members of the Special Committee of the Board of Celsius, expressed pride in the preservation and distribution of cryptocurrency assets and enhanced recovery for customers and claim holders.
Celsius will now begin an orderly wind down of its operations, including discontinuing its mobile and web applications. Matt Prusak, Chief Commercial Officer of Hut 8, has been named CEO of Ionic Digital and will oversee its Bitcoin mining business under a management agreement.
Throughout the restructuring process, Celsius has worked closely with the Official Committee of Unsecured Creditors, regulatory agencies, and its advisors to ensure secure and compliant distributions.
