Pepe (pepe) 
Consultants overseeing the liquidation of Celsius Network LLC are seeking the return of $2 billion from major clients to avoid potential litigation. The committee formed during the bankruptcy case is demanding the return of assets that were withdrawn from the platform shortly before it filed for bankruptcy.
Advisors have started contacting clients who withdrew more than $100,000 from the platform before the bankruptcy filing. Recovered assets will be used to repay creditors who have not yet withdrawn funds from Celsius.
The committee is offering customers the option to settle their potential liabilities based on the value of their assets at the time of withdrawal in 2022. This means that settling customers would retain any appreciation in the value of their digital assets due to the surge in crypto prices over the past year.
The recovery process will impact around 2% of Celsius users, who collectively withdrew approximately 40% of the platform’s assets 90 days before the Chapter 11 filing. At the time of the bankruptcy, Celsius reported $6 billion in crypto assets, 1.7 million registered users, and 300,000 active users with balances over $100.
In August 2022, Celsius Network’s debts exceeded its assets by $2.85 billion. The shortfall in funds to pay creditors was nearly 2.5 times greater than initially estimated when filing for bankruptcy, with a projected shortfall of $1.2 billion.
Celsius Network’s creditors have put forth a plan to reorganize the company, which has been approved by most account holders. The plan involves distributing over $3 billion in cryptocurrency and fiat funds to creditors.
