Celsius To Unstake $470m ETH, Slowly Returns Creditor Funds

Written by

Eddie Mitchell

Cryptocurrency Writer

Bankrupt crypto lender, Celsius Network, yesterday announced plans to begin returning creditor funds by unstaking an enormous amount of Ethereum (ETH) tokens, which are currently valued at almost half a billion dollars.

Unstaking ETH

As per the official Tweet from Celsius, the company has begun the process of unstaking all of its ETH holdings to “offset costs incurred throughout the restructuring process”.

Celsius hasn’t revealed the exact number of ETH set to be unstaked, but blockchain analytics firm Nansen data estimates that 32% of ETH in the pending withdrawal queue comes from Celsius. 

If this figure is accurate, this means 206,300 ETH, or roughly $463,987,267 worth is set to be released. 


This has set off some concerns about whether a large-scale withdrawal such as this could have negative impacts on the value of ETH, though some speculate that it could have a positive effect in the long term.

Whilst this fact remains yet to be seen, 24-hour data from CoinMarketCap shows a rather volatile pattern on a downward trend, which is likely the result of the news.

Restructure, rebalance, refund

In July 2022, Celsius filed for Chapter 11 bankruptcy. A year later in November 2023, Celsius had its bankruptcy exit plan approved.

Under these plans, Celsius plans to create a new firm through which it will distribute $2 billion in Bitcoin (BTC), ETH, and company stocks in a new entity to creditors. Customers who had accounts frozen following the bankruptcy will receive crypto and/or equity via the new company.

With the settlement plan now approved, Celsius Network has allowed qualified users to withdraw 72.5% of holdings until 28 February 2024.

A move to mining

Celsius outlined post-bankruptcy plans detailing a shift toward Bitcoin mining, which was naturally received with skepticism from creditors. Considering that the firm is already embroiled in one of the worst crypto incidents in recent times, it would need to work quite hard to receive approval from the US Securities and Exchange Commission (SEC).

That said, in late December 2023, a court granted approval to proceed with this restructuring strategy. The newly formed entity currently dubbed 'MiningCo' will be operated by crypto mining firm Hut 8.

The agreement gives Hut 8 a four-year mining management contract, with supervision for five Texas-based mining locations and approximately 122,000 mining computers.

Ashner Genoot noted in a press release at the time: “The mining plan that was presented to the creditors and the courts is strong and sound, and we look forward to proceeding with construction imminently at the Cedarvale, Texas site, and managing four additional sites once the process closes in the first quarter of 2024.”