Bankrupt cryptocurrency lender Celsius and its Series B creditors and holders have reached a settlement regarding the distribution of $25 million of the proceeds from the sale of GK8 cryptocurrency portfolio.
According to the filing, the settlements seek $24 million for legal expenses with the remaining $1 million set aside among Class B holders. The court document also states that the settlement agreement arose out of a “mutual desire” to prevent costly legal disputes and an extensive confirmation process, which would result in higher professional fees.
- The agreement between the debtors, the commission, and the Class B Initial Consent holders is said to be “thoughtfully negotiated and eminently reasonable.”
- the filing is reading,
“The settlement brings to an end nearly a year of contentious litigation and removes one of the largest hurdles to confirmation and exposure in exchange for a cash settlement of $25 million in proceeds from the sale of the GK8 and a mutual release from claims between the preferred Series B preliminary consent holders and the real estate parties.”
- GK8 was initially purchased by Celsius for an unknown amount, which was later disputed to be $115 million, in November 2021.
- However, with Celsius filing for Chapter 11 bankruptcy protection last summer following the collapse of Terra’s ecosystem, Galaxy Digital led by Mike Novogratz agreed to buy the Israel-based company as part of the bankruptcy proceedings.
- Celsius’s former CEO, Alex Mashinsky, was arrested last week and charged with wire fraud and other offences.
- US prosecutors also alleged that the exec raised the price of his company’s cryptocurrency to lure customers to the platform.
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