TL;DR
1.Celsius Creditors Receive Crypto Distributions via PayPal and Coinbase.
2.Celsius Restructuring Plan Sparks Speculation in Crypto Industry.
3.Legal Team's Dual Representation Raises Concerns in Celsius and FTX Cases.
Cryptocurrency lender Celsius, which recently emerged from bankruptcy, has successfully distributed $2 billion worth of cryptocurrency to 172,000 creditors. The distribution was facilitated by payment giant PayPal and crypto exchange Coinbase, acting as distribution agents.
In a recent court filing by Kirkland & Ellis, the legal representation for Celsius, an update was provided on the distribution of creditors' assets as outlined in the restructuring plan. The majority of eligible creditors, both in the United States and overseas, have collected their liquid crypto distributions through PayPal and Coinbase, respectively.
The distributions included 20,255.66 Bitcoin (BTC) and 301,338.77 Ethereum (ETH). Despite the successful distribution to most holders, those who did not agree to the restructuring plan will not receive crypto distributions until their individual claims are resolved. Moreover, account holders may face challenges in receiving their distribution if flagged for anti-money laundering (AML) or compliance issues by Coinbase or PayPal.
Post-effective date Celsius debtors' first update on distributions.Source: Stretto
The actions outlined in the restructuring plan have sparked speculation within the crypto industry regarding their potential impact on the broader market. Celsius had initiated asset recalls and rebalancing to ensure timely distributions to creditors, with a significant portion of pending ETH withdrawals belonging to Celsius.
Former CEO Alex Mashinsky is scheduled for trial in September 2024 concerning Celsius' collapse. However, his legal team, which also represents Sam Bankman-Fried, former CEO of bankrupt crypto exchange FTX, has faced scrutiny for potential conflicts of interest. U.S. prosecutors raised concerns about lawyers Marc Mukasey and Torrey Young's involvement in both cases, leading to calls for a Curcio hearing to address these issues.
Celsius has completed the distribution of $2 billion in cryptocurrency to creditors through PayPal and Coinbase. Speculation surrounds the impact of these actions on the crypto market, while legal proceedings raise concerns about potential conflicts of interest within the legal representation.
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