Celsius to repay 72.5% of the crypto assets on custody account settlement
A federal judge authorized a settlement in the bankruptcy case of the defunct crypto lender Celsius. Holders of custodial accounts can now collect 72.5% of the crypto in such arrangements.
During a hearing on March 21 in the US Bankruptcy Court for the Southern District of New York, Judge Martin Glenn approved a compromise between the Celsius debtors, the unsecured creditor’s committee, and an ad hoc group of custodial account holders.
Owners of personal custody accounts must choose to participate in the settlement. The terms of the Agreement provide that the Celsius Debtors shall settle all claims against the holders of the Custody Accounts concerning the custody assets.
According to the settlement, the repayment of 72.5% will happen gradually and does not include transaction fees. Assets belonging to the Celsius bankruptcy case’s customers have frequently been a problem.
In his January decision, Glenn stated that the firm, not the users of Celsius Earn accounts, owns the assets. None of the Tuesday-approved settlement’s rights or causes of action about the assets held in the Earn program are released.
According to Judge Martin Glenn, who presides over the Celsius bankruptcy case, in January, it was stated that the monies in the Celsius interest-bearing Earn program belonged under the rules of the program’s usage conditions. The money was said to be worth more than $4 billion.
A lengthy procedure led to the deal reached on March 21, according to Bryan Kotliar, an attorney for the ad hoc group of custodial holders.
“Beyond what is mentioned in the filings, it has truly been a rollercoaster ride behind the scenes …There have been many ups and downs,” Kotliar explained. “It’s a settlement that I believe everyone is slightly dissatisfied with.”
“Usually, that’s the best settlement,” Glenn said.