Celsius is a cryptocurrency lending protocol that has announced an unstaking $470 million in ETH tokens. The platform currently holds around 206,300 ETH in the form of staked withdrawals as per Nansen. Celsius filed for Chapter 11 bankruptcy filing on July, 2022.
On this account, the platform has started the process of recalling and rebalancing the commercial holdings that are inclusive of ETH. The unstaking process is part of the repayment plan for creditors. The platform noted on 5th January, 2024 that it is reshuffling assets to provide ample liquidity ahead of the upcoming repayment distributions.
The platform has stated that it has started the process of unstaking ETH reserves that have generated sizeable yield to support the estate. On this account, the unstaked ETH is going to go towards covering incurred costs during the restriction process.
At the same time, the liberated ETH will also ensure timely distribution to creditors. The firm posted on social media that it has completed preparations for asset distributions. On this account, Celsius has recalled and rebalanced holdings to avoid lack of liquidity.
Celsius Users to Access Their Locked Funds Once Again
The announcement has reassured the clients of Celsius that they will be able to access locked funds out of their accounts. In accordance with the recovery plan, Celsius stated that it is going to reimburse the investors in the form of Bitcoin or Ethereum.
Nansen, a blockchain analytics firm recently reported that around 1/3rd of ETH are added to the outstanding withdrawal queue under the propriety of Celsius. In terms of quantity it accounts for 206,300 ETHs that are valued at $468.5 million at the recent price.
Meanwhile, 19,906 validators working at the Celsius network are expecting full exit with the protocol already withdrawing 40,249 ETH thus far. There are some concerns that the move can lead to a price decline for ETH. However, others believe that in the long run, it is going to be a good development for Ether.
One social media user added that most people do not realize how much weight would be lifted from Ether once Celsius vampires finally go into obscurity and oblivion. The platform is among one of the major cryptocurrency lending platforms that went bankrupt in 2022.
Celsius Gets Court Approval for Bitcoin Mining Project
Bankruptcy judge Martin Glenn, who is supervising Celsius chapter 11 filing approved the motion of the firm to operate a Bitcoin mining firm. The judge allowed the firm the amended application of the lending protocol that previously included Fahrenheit consortium. The court ruling arrived at 27th December, 2023 when Judge approved the renewed mining plan since it does not affect Celsius creditors.
The plan includes founding a public company that works on Bitcoin mining rather than working on various operations in association with the Fahrenheit consortium.
The previous plan was disapproved by the Securities and Exchange Commission as a bankruptcy exit plan. SEC officials retained that the plan was overruled on the basis of transaction requirements. Furthermore, the debtors opted for the second path following the vote of creditors.
The new plan will allow the creditors to become shareholders of the Bitcoin mining firm. At the same time, this plan will release $225 million in the form of digital assets to fund a new business that SEC did not approve.