Celsius and FTX move crypto to exchanges to repay creditors

abdelaziz Fathi

Embattled crypto lender Celsius Network has been actively transferring Ethers to cryptocurrency exchanges, a move seen as part of its efforts to begin repaying creditors.

According to Arkham Intelligence data, between January 8 and 12, Celsius transferred a total of approximately $125 million worth of Ether to Coinbase and FalconX.

Celsius still retains the bulk of its Ethereum holdings, with over 550,000 ETH on its books, valued at around $1.36 billion. Earlier this month, Celsius said it was unstaking 206,300 ETH to address costs associated with its restructuring process and to prepare for repaying its creditors. The company also announced plans to distribute Bitcoin and Ethereum to creditors in its recovery plan, though a specific date for these distributions has not been specified yet.

However, the platform’s staked Ethereum has been a source of income, providing staking rewards which have been beneficial to the estate. According to analytics firm Nansen, Celsius currently holds 32% of Ethereum awaiting withdrawal, valued at over $466 million at current market rates.

As part of its bankruptcy settlement plan, Celsius has allowed qualified users to withdraw 72.5% of their crypto holdings, with this opportunity available until February 28. A court filing from September last year revealed that nearly 58,300 users held custody assets valued at $210 million.

Separately, the bankrupt crypto exchange FTX and its defunct trading arm Alameda Research have also been transferring crypto assets to exchanges. Spot On Chain reports that FTX and Alameda Research moved $28 million in cryptocurrencies, including Wrapped Bitcoin, Ether, and Pendle (PENDLE), to Coinbase and Binance on January 14.

These transfers by FTX and Alameda are part of their efforts to raise funds for creditor repayment following their bankruptcy declaration in November 2022. FTX administrators have reportedly reclaimed approximately $7 billion in assets, including $3.4 billion in cryptocurrency.

The market’s response to FTX creditor claims has been somewhat optimistic, with some claims trading as high as $0.50 on the dollar in October 2023. This suggests a reasonable chance for creditors to recover their funds. While there is no definitive timeline for FTX customer reimbursements, current plans estimate that repayments should start sometime in 2024.

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