Creditors of bankrupt crypto lending firm Celsius are raising concerns over a reduction in payments they were promised under the original bankruptcy plan. The reduction is reportedly due to a rule that only allows 100 Celsius corporate accounts to receive distributions through the Coinbase exchange. This rule forces some creditors to accept cash instead of crypto, resulting in significantly reduced payments for small business creditors compared to the top 100 accounts. One creditor in Australia claimed they were owed 0.182 BTC and 3.05 ETH but were instead offered $15,741 in cash, 36% less than the cryptocurrencies’ market value. Other creditors have also voiced their dissatisfaction with the alleged Coinbase rule. The bankruptcy plan, which was approved by the court on November 9, uses two sets of crypto prices to determine the amount owed to creditors. Most creditors are being paid in crypto, but the effective date prices for Bitcoin and Ether are significantly higher than the petition date prices, resulting in missed gains for some creditors. Celsius debtors have responded to the claims by stating that the cryptocurrency owed to these creditors has already been sold, and they cannot pass on the benefits of the recent rise in crypto prices. They also cited compliance and onboarding difficulties as the reason for not being able to provide accounts to all corporate creditors.
Creditors of Celsius claim they were promised 30% more compensation during bankruptcy.