Bankrupt crypto lender Celsius has repaid nearly $2.53 billion to 251,000 creditors as part of its ongoing bankruptcy proceedings.
According to a court filing, this repayment represents about 84% of the $3 billion in assets owed to over 375,000 creditors.
Interestingly, not all creditors are actively trying to claim their cryptocurrency, especially those owed smaller amounts. The filing shows that about 64,000 of the remaining 121,000 creditors have less than $100 worth of crypto, while 41,000 are owed between $100 and $1,000.
The bankruptcy administrator has been working to distribute funds to these creditors through Coinbase every two weeks, with PayPal claim codes available for redemption at any time. The administrator reported making over 2.7 million distribution attempts to the roughly 372,000 eligible creditors.
Earlier in July, a married couple holding corporate accounts with Celsius filed for a second payout. They argue that their payment was reduced by 35% compared to non-corporate accounts.
These Individual Retirement Accounts (IRAs), owned by Sheri Anne Faller and Bernard Jacob Faller, held over $1 million in cryptocurrency before Celsius filed for bankruptcy. According to the bankruptcy plan, their claim was reduced to $634,337.93, which included 7.38 BTC and 123 ETH to be paid out on January 16.
However, the Celsius debtors allegedly missed the payment deadline. On January 19, a representative informed the couple that they would not receive cryptocurrency payments since their accounts were not among the top 100 corporate accounts by asset value. Instead, the cryptocurrency would be converted to cash and paid out through the banking system.
Despite agreeing to the cash payment, the couple claims they were not paid promptly. They received a wire transfer of $414,733 on February 22 but could not withdraw the funds until March 8.
Additional payments totaling $219,602 were received on April 22, amounting to $634,335. They argue that this cash value is far less than the value of the BTC and ETH they were owed, based on the prices on the payment dates. They added that they should have received $973,955 and are demanding an additional $338,611 plus $11,984 in interest for holding their cryptocurrency past the required distribution date, totaling $350,596.
Other corporate creditors have also complained of unfair treatment, alleging delayed payments and cash settlements instead of crypto, causing further losses. In March, another corporate creditor claimed to have received 30% less than agreed under the plan.
Celsius stated that it had already sold the users’ cryptocurrency on January 16, as required by the bankruptcy plan, and could not pay in crypto that it no longer held. The estate claimed corporate accounts had a more demanding compliance and onboarding process, which prevented obtaining accounts for the majority of corporate creditors.
