Celsius mining plan approved by U.S. bankruptcy judge

A U.S. bankruptcy judge has approved cryptocurrency lender Celsius Network’s pivot to bitcoin mining, allowing the company to deviate from its previously approved bankruptcy plan. Judge Martin Glenn ruled on Wednesday that creditors and customers would be no worse off under the new restructuring.

Celsius filed for Chapter 11 protection in July 2022 amid a spate of crypto lender bankruptcies. The company had originally planned to earn fees from crypto transactions and launch new business lines but scaled back after the proposal was rejected by the U.S. Securities and Exchange Commission (SEC).

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The switch means Celsius will fully focus on mining Bitcoin, under the management of Asher Genoot’s US Bitcoin Corp rather than a consortium of bidders. Some creditors and the U.S. Department of Justice argued Celsius should put the new plan to a fresh creditor vote, but Glenn approved it without one.

The move frees up $225 million in crypto assets to return to customers, who will also receive equity in the mining operation. Celsius expects to emerge from bankruptcy in 2024.