Celsius Network has successfully emerged from Chapter 11 bankruptcy marking a milestone in its journey. As part of its strategy to recover the company announced the establishment of Ionic Digital, an entity dedicated to Bitcoin mining. This move will play a role, in continuing the recovery process for creditors. Ionic Digital will be led by Matt Prusak, who holds the position of Chief Commercial Officer at Hut 8 a known mining firm.
Moments ago, @CelsiusNetwork filed voluntary petitions for Chapter 11 protection and announced that the company initiated a financial restructuring. https://t.co/vf5wsT6TMp
— Celsius (@CelsiusNetwork) July 14, 2022
The plan involves distributing over $3 billion worth of cryptocurrency and fiat to Celsius creditors. This distribution has already. Includes offering stock in Ionic Digital to the creditors. This innovative approach aims to support creditor recovery within the cryptocurrency sector. Pending approvals it is expected that Celsius stock will become publicly traded.
The establishment of Ionic Digital and the initiation of distributions are part of a reorganization plan approved by the Bankruptcy Court on December 27 2023. This plan received support from 98% of Celsius creditors showcasing strong collaboration between Celsius, strategic partners and the creditor community. It also represents a shift, for Celsius as they transition their focus towards this Bitcoin mining venture.
Celsius has also revealed that they have expanded the amount of assets that can be distributed to creditors by, around $250 million. They achieved this increase by converting altcoins into tradeable cryptocurrencies such as BTC or ETH and through settlements made before exiting bankruptcy.
As per the approved reorganization plan Celsius is planning to phase out its operations, including discontinuing its mobile and web applications. This decision is part of a transition process as the company shifts its focus, towards new mining operations and helping creditors recover their funds through Ionic Digital.
