On 9 November, Judge Martin Glenn of the Bankruptcy Court for the Southern District of New York approved the plan, which received significant support from Celsius creditors on 27 September. The approval of the Celsius bankruptcy plan is a significant development, providing creditors with an opportunity to recover funds and purchase shares in the reorganised company, called NewCo.

Under the approved plan, Celsius creditors will be allocated approximately $2 billion in bitcoin and Ethereum, as well as shares of NewCo stock. The company intends to begin paying creditors by the end of this year.

A significant portion of the lenders were participants in the Celsius Earn programme, under which they received weekly rewards by holding locked CEL tokens. Judge Glenn clarified in his ruling that the confirmation order was not a determination of whether the CEL tokens or the Earn programme qualified as securities, addressing concerns raised by the SEC.

Managed by the Fahrenheit consortium of various cryptocurrency companies, NewCo plans to expand Celsius’ former mining operations, monetise illiquid assets and pursue other areas of development, subject to regulatory approval. The bankruptcy and restructuring process followed Celsius’ July 2022 bankruptcy filing and the indictment of its former CEO Alex Mashinsky on charges of securities fraud, commodities fraud and communications fraud. Mashinsky’s trial is set for September 2024, while former Chief Revenue Officer Roni Cohen-Pavon pleaded guilty to fraud and is awaiting sentencing on 1 December.