Celsius, a cryptocurrency lending platform, said on Jan. 31 that it has exited bankruptcy and has begun to repay creditors affected by its failure.

The company said that it has “successfully emerged from bankruptcy” by carrying out the transactions outlined in its confirmed reorganization plan.

Chris Ferraro — Celsius’ Chief Restructuring Officer, Interim Chief Executive Officer, and Chief Financial Officer — said:

“Creating the best outcome for creditors by maximizing value and speed have been front of mind for Celsius throughout this process … Today, over 18 months after Celsius paused withdrawals, we began distributing over $3 billion of cryptocurrency, fiat, and stock in Ionic Digital to Celsius creditors.”

Celsius said that those funds are now being distributed. It added that it recently inreased the amount of funds available for distribution by nearly $250 million by converting altcoin holdings to Bitcoin (BTC) or (ETH) and through settlements.

The company said that the reorganization also establishes a new Bitcoin mining company called Ionic Digital, which will be owned by Celsius creditors. Its operations will be handled by the existing cryptocurrency mining firm Hut 8 Corp.

Celsius said that its reorganization plan was approved by 98% of account holders and was confirmed by bankruptcy court on Nov. 9, 2023. The mining company transaction, meanwhile, was approved by bankruptcy court on Dec. 27, 2023.

Celsius otherwise stated that it will wind down its existing operations in an orderly fashion, including by discontinuing its mobile and web apps.

Celsius Part of Broader Liquidity Crisis

Prior to its collapse, Celsius was among the most well-known crypto lending firms to offer users interest on their crypto deposits. However, Celsius became unable to pay users due to changing market conditions starting in mid-2022. The firm disabled withdrawals in June 2022 and filed for bankruptcy in July 2022.

Several other crypto firms were also affected by the same liquidity crisis in the summer of 2022. A number of those firms have since opened claims and withdrawals or concluded their bankruptcy proceedings entirely.

FTX, which collapsed significantly later in November 2022, is nearing the end of its bankruptcy proceedings. Late January reports suggest that customers will receive their holdings in full, though FTX will not reopen as previously planned.

Another high-profile crypto lending service, Genesis, filed for bankruptcy even later in January 2023. The firm notably reached a conditional $21 million settlement with U.S. securities regulators on Feb. 1. Genesis will only pay that fine it fails to pay customers in full. Because the company’s bankruptcy proceedings are still in progress, it is unclear whether it will meet that condition.