Celsius Native Token CEL Soars 300% A Month Following $2.5 Billion Creditor Repayments

Defunct crypto lender Celsius repaid over $2.5 billion to creditors as part of its bankruptcy settlement.A month following this repayment, the protocol's native token, CEL, surged by over 300% to surpass $0.6.

This substantial price surge indicates increased trading activity and a robust reclaim of investor confidence.

CEL Token Surges Following Celsius' Bankruptcy Settlement

According to an August 26 court filing, Celsius repaid approximately $2.53 billion in crypto assets to 251,000 creditors. This repayment is part of the settlement process in the company's bankruptcy proceedings.

After starting the settlement, the Celsius (CEL) token's price increased significantly. CoinMarketCap data shows Celsius (CEL) traded around $0.16 when the repayment scheme was initiated.

However, on September 23, the token's price reached a high of $0.6768, reflecting a 300% increase since August 26. Though its price has pulled back by over 25% in the last 24 hours, CEL still holds above $0.47 at the time of writing.

Despite the recent recovery, Celsius remains 93.57% down from its all-time high of $8.02 recorded on June 4, 2021.

Celsius Repays Over $2.5 Billion in Crypto Assets to Creditors

In February, Celsius successfully exited Chapter 11 Bankruptcy and initiated creditors payout.

On August 26, the company repaid approximately $3 billion in crypto and fiat to 84% of creditors. While most creditors partook in this distribution, not all those eligible for reimbursement can claim their assets.

The reason is that some are owed small amounts. According to the filing, of the remaining creditors yet to claim their funds, 64,000 have below $100 in crypto to claim. Meanwhile, 41,000 creditors have between $100 and $1,000 in assets to claim.

The small amount may be why creditors have not claimed their funds. The filling explained that the creditors might not be incentivized to undertake the steps involved in claiming the distribution.

In addition, the bankruptcy administrator revealed in the filing that it had initiated over 2.7 million distributions to eligible creditors.

Celsius filed for Chapter 11 bankruptcy in July 2022 following the Terra ecosystem collapse. Days after hiring bankruptcy lawyers, the company emailed its users about this development.

The crypto lender incurred a fine of $4.7 billion from the US Federal Trade Commission due to the bankruptcy.

On July 13, the US SEC also filed charges against Celsius and its founder, Alex Mashinsky, for fraud and offering and selling unregistered securities. The SEC accused the company and its CEO of fraud, misleading customers, and manipulating CEL's price to induce investors to buy the token.

In its press release, the SEC said the crypto lender is cooperating and has agreed to settle the requests in its complaint.Celsius said it was happy with how the resolutions with US regulators went.

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