Celsius Bankruptcy Case Settlement
In a significant development regarding the Celsius bankruptcy case, Tether has agreed to disburse $299.5 million to close all disputes related to this legal matter. The settlement was officially announced on October 14, 2023, by the Blockchain Recovery Investment Consortium (BRIC), a collaborative effort between GXD Labs and VanEck. Tether, known for creating USDT, the predominant stablecoin pegged to the U.S. dollar and boasting a market valuation exceeding $180 billion, made this payment to the Celsius Network bankruptcy estate.
Background of the Dispute
This arrangement addresses claims that arose from adversary proceedings initiated in August 2024, centered on issues like collateral transfers and liquidations that severely impacted Celsius in July 2022. At that time, Celsius had to halt withdrawals, corresponding with the broader turmoil in the cryptocurrency market, ultimately leading to its Chapter 11 bankruptcy filing on July 13, 2022, exacerbated by a staggering deficit of over $1.2 billion in its accounts.
Formation of BRIC
BRIC was established in early 2023 with the aim of optimizing recoveries from various cryptocurrency-related bankruptcies, including that of Celsius. Under the organization, Celsius pursued legal action in August 2024, aiming to reclaim 39,342 bitcoin (BTC) from Tether. Initially, Tether sought to have the case dismissed, but a bankruptcy judge allowed proceedings to continue in July 2025.
Statements from Key Figures
Tether’s CEO, Paolo Ardoino, confirmed the settlement through a post on X, expressing satisfaction at having reached an agreement to resolve all pertinent issues associated with the Celsius bankruptcy proceedings.
David Proman, managing partner at GXD Labs, also voiced his contentment regarding the swift resolution of the claims against Tether in the U.S. Bankruptcy Court for the Southern District of New York.
Impact on the Cryptocurrency Sector
The downfall of Celsius Network in 2022 coincided with a tumultuous phase for the cryptocurrency sector, which also saw the collapse of other notable lenders like BlockFi and Voyager Digital, and the infamous failure of the crypto exchange FTX.
