- Celsius Network has begun its third creditor payout, distributing a total of $220.6 million
- The distribution will be made in Bitcoin (BTC) and Ethereum (ETH) via Coinbase and PayPal
- Funds were sourced in part from $17M in disallowed claims from the firm’s former CEO
Celsius Network is beginning its third major distribution to creditors, a payout totaling $220.6 million. This is part of the court-supervised recovery plan that followed the crypto lender’s shocking collapse in 2022.
For the thousands of users who have faced prolonged uncertainty, this distribution represents one of the most substantial returns to date.
How the $220M Payout Was Funded
Court filings reveal the funds were pieced together from several sources within the bankruptcy estate. A key contributor was $17 million in disallowed claims connected to the firm’s disgraced founder. As the Celsius Founder Pleads Guilty: Faces Fraud Sentencing in 2025; funds tied to him, are now being redirected to victims.
Other major sources include $86.4 million from released reserves for disputed claims and $46.3 million from forfeited claims. Together, these pools of capital have enabled this latest payout, while approximately $63.2 million has been allocated to cover the extensive legal and administrative costs of the complex process.
The Distribution Plan for Creditors
Eligible creditors will receive their distributions in Bitcoin (BTC) and Ethereum (ETH). To claim their funds, individuals must complete Know-Your-Customer (KYC) verification with designated partners, including Coinbase and PayPal. Corporate entities may receive their payments in U.S. dollars.
In a move designed to boost overall recovery, creditors will also receive equity shares in a new entity called Ionic Digital. Including the value of this stock, some projections estimate that creditors could ultimately recover between 67% and 85% of their holdings.
While the recovery process remains ongoing, with the Celsius Lawsuit Against Tether for $4 Billion in Bitcoin still pending, this third payout is a critical step forward.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
Source: https://coinedition.com/celsius-to-use-disgraced-founders-funds-part-of-220m-creditor-payout/
