Celsius Prepares $127 Million Creditor Payout in Second Round of Distributions After Bankruptcy Exit

Celsius is about to distribute $127 million to creditors in its second payout round. This was shared in a court filing on November 27.

The funds will go to creditors in five categories: retail borrower deposit claims, general earn claims, withhold claims, unsecured loan claims, and general unsecured claims. Each eligible creditor will receive 60.4% of their claim's value as of the Petition Date.

After coming out of Chapter 11 bankruptcy in January, Celsius paused its mobile and web apps on February 29. They’ve started the process of reimbursing creditors. Some creditors even received shares in Ionic Digital, a new company formed from Celsius’ reorganized mining operations.

This upcoming payout follows a much larger one in August. Back then, Celsius distributed over $2.53 billion to more than 251,000 creditors. That first payout addressed about two-thirds of all eligible creditors and covered roughly 93% of the eligible value.

To give you some background, Celsius filed for Chapter 11 bankruptcy on July 13, 2022, after the company collapsed. Former CEO Alex Mashinsky resigned in September 2022 and was later arrested on fraud charges. His trial is set for January 2025. Additionally, Roni Cohen-Pavon, the former Chief Revenue Officer, pleaded guilty to market manipulation and fraud last year. He’s due for sentencing next month.

On top of that, Celsius reached a $4.7 billion settlement with U.S. authorities regarding fraud allegations. It’s been quite a journey for the company and its creditors.