The price of Celsius Network’s native token, CEL, experienced a more than 12% increase on Saturday as news broke that the platform has resolved two critical bankruptcy issues. This development has raised hopes that customer assets could potentially be returned by the end of the year. Despite paring some gains, CEL traded at $0.18, representing a significant recovery from recent lows of $0.13.
Why is the Price of Celsius Network Up?
According to court documents filed on July 20, Celsius has reached a settlement with the Official Committee of Unsecured Creditors regarding a class claim made by account holders. These holders accused the former management of fraud, misrepresentation, and other harmful actions. The resolution of this claim brings the platform closer to confirming its bankruptcy plan in October, with the distribution of assets to account holders expected by the end of the year.
Additionally, there is the possibility that customers with interest-bearing Earn accounts may receive a portion of their money in cryptocurrency assets. They may also become eligible for shares of the new company once the bankruptcy proceedings conclude.
About 30,000 account holders filed claims totaling $78.2 billion against the collapsed crypto lender. Under the settlement, the management team has agreed to increase customer reimbursements by 5%. Account holders who opt-in to the settlement will receive a claim worth 105% of their scheduled claim, which will replace any related Proofs of Claim filed by the account holder. Not participating in the settlement could result in delayed distribution and potentially lower recoveries due to the high expenses associated with the proceedings.
The resolutions reached by Celsius will be examined by US Judge Martin Glenn on August 10.
Celsius Network’s CEL token experienced a price surge of more than 12% after the platform resolved two key bankruptcy issues. The settlement with the Official Committee of Unsecured Creditors and the potential reimbursement of customer assets have raised hopes that assets could be returned by the end of the year. The resolutions will be examined by Judge Martin Glenn on August 10.
Frequently Asked Questions (FAQ)
What is Celsius Network?
Celsius Network is a crypto lending platform that allows users to earn interest on their crypto assets and borrow against them.
Why did the price of CEL token increase?
The price of the CEL token increased because Celsius Network reached a settlement with the Official Committee of Unsecured Creditors, resolving two key bankruptcy issues. This news raised hopes among holders that customer assets could be returned by the end of the year.
What are the potential benefits for Celsius Network account holders?
If the bankruptcy plan is confirmed and the resolutions are implemented, Celsius Network account holders with interest-bearing Earn accounts may receive a percentage of their money in crypto assets. They may also be eligible for shares of the new company after the bankruptcy proceedings end.
What happens if account holders do not participate in the settlement?
Account holders who do not participate in the settlement may face delayed distribution of assets and potentially lower recoveries due to the high expenses associated with the proceedings.
When will the resolutions be examined?
The resolutions reached by Celsius Network will be examined by US Judge Martin Glenn on August 10.