Celsius Mining Company Receives Final Approval for 225 Million Dollars Through Significant Court Order

Celsius Mining Company: In a significant development, the United States Bankruptcy Court for the Southern District of New York has granted its ultimate approval for the execution of the “MiningCo Transaction” within the ongoing Chapter 11 bankruptcy proceedings involving Celsius and its associated debtors. The decisive order, issued on December 27 by Chief Judge Martin Glenn, marks a pivotal milestone in the intricate process of restructuring Celsius, particularly notable as all objections to the proposed transaction were unequivocally overruled.

Celsius Mining Company Receives Final Approval for 225 Million Dollars Through Significant Court Order

This court-sanctioned decision now effectively paves the way for Celsius to forge ahead with the MiningCo Transaction, a strategic move designed to bring stability and a renewed structure to the company’s operations by birthing “a public company singularly focused on bitcoin mining.” The transaction encompasses specific terms and conditions intricately woven into Celsius‘ comprehensive restructuring plan. It includes the infusion of $225 million in fiat currency to capitalize the nascent entity (NewCo) and the strategic transfer of designated mining assets to NewCo—excluding the Core Rhodium, Mawson, and Luxor assets.

In tandem with this, the court’s order extends its approval to modifications within the Management Agreement. These alterations set the initial term at four years, incorporating certain conditions governing extension or early termination. Noteworthy among these conditions is the provision that grants NewCo the right to terminate the agreement without an early termination fee if, within the initial three years, its mining capacity falls short of the specified Exahash Target of 23 EH/s—provided a six-month transition period is afforded.

Additionally, the court’s imprimatur is bestowed upon the “Wind-Down Budget and Procedures,” a critical component facilitating the systematic execution of the restructuring plan. The Wind-Down budget meticulously delineates substantial expenses, encompassing administration fees, professional fees, and operating expenses, aggregating to an approximate sum of $70 million. These expenditures play a pivotal role in orchestrating the distribution of asset sales and the effective administration of the estate.

Moreover, the court addressed the nuanced and complex matter concerning the Securities and Exchange Commission’s (SEC) rights vis-à-vis crypto tokens. The order explicitly stipulates that nothing within the court’s decision should be construed as a determination under federal securities laws regarding the status of crypto tokens or transactions involving them. This provision explicitly upholds the SEC’s authority to challenge transactions involving crypto tokens.

This court approval heralds a notable departure from the initial plan, steering towards a meticulous and orderly wind-down, propelled by the aim of securing optimal outcomes for creditors. The decision materialized after careful consideration of an array of inputs, including objections and supportive statements, underscoring the court’s steadfast commitment to a fair, just, and legally sound resolution.

Consequent to this ruling, prior agreements dictating the handling of unsecured claims stand null and void. The court has diligently set forth new guidelines governing the winding down of the company’s operations and the judicious management of creditor payouts.

Celsius Network Receives Approval for Transition into Bitcoin Mining

A US bankruptcy court has granted approval to Celsius Network’s transition to Bitcoin mining as part of the ongoing Chapter 11 bankruptcy proceedings initiated by the collapsed crypto lender in July 2022.

Judge Martin Glenn of the US Bankruptcy Court for the Southern District of New York issued the approval order on December 27, as reported by Reuters.

According to the ruling, Celsius is now authorized to proceed with its restructuring plans, with a primary focus on shifting the company’s operations toward Bitcoin mining.

This court order holds significance as it overruled objections to the restructuring plans, clearing the path for Celsius to execute the move and strategically distance itself from the impactful bankruptcy proceedings. In a related development, US Bitcoin Corp announced in August that it had agreed to host 8,500 miners for Celsius Network.