Celsius, the embattled cryptocurrency lender, has taken a significant step in addressing its financial turmoil. The bankruptcy administrator has successfully distributed over $2.53 billion to approximately 251,000 creditors, marking a pivotal moment in the company’s arduous recovery process. This milestone was highlighted in the administrator’s inaugural status report on the disbursements, showcasing the sheer scale and complexity of the endeavor.

The payments, made in liquid cryptocurrency and cash, were calculated at prices as of January 16. This distribution covers roughly two-thirds of all eligible creditors by number, and impressively, it accounts for about 93% of the eligible value owed. Yet, despite this substantial progress, there remain approximately 121,000 eligible creditors who have not successfully claimed their distributions, with an average payout of around $1,500 still pending.

The court filing revealed the granular details: “Approximately 64,000 of these remaining creditors have a distribution of less than $100, and approximately 41,000 more have a distribution between $100 and $1,000.” Given the relatively small sums involved for many of these creditors, the report suggests that they may lack sufficient incentive to complete the necessary steps to claim their distributions.

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The closure of the bankruptcy proceedings was officially sanctioned by the United States Southern District of New York Bankruptcy Court, following the approval of a comprehensive reorganization plan in November. This plan, which outlines the distribution of more than $3 billion to Celsius creditors, was finalized at the end of January. In the seven months since, the process of distribution—described in the filing as “likely the most complicated and ambitious distribution process ever attempted in a Chapter 11 case”—has been in full swing.

The reorganization strategy involves distributing a mix of liquid cryptocurrency, cash, and common stock in MiningCo, the successor company that emerged from the ashes of Celsius. The distribution is aimed at around 375,000 creditors spread across more than 165 countries, underscoring the global reach and impact of Celsius’s collapse. The filing further elaborates on the challenges, noting that Celsius’s pre-bankruptcy operations were not fully compliant with regulatory standards, and numerous regulators were actively pursuing enforcement actions against the company. This regulatory backdrop has significantly compounded the intricacies of the distribution process.

In a recent development, earlier this month, Celsius petitioned the bankruptcy court to compel Tether to relinquish bitcoin worth approximately $3.3 billion. This move is based on allegations that Tether labeled as a “shakedown” lawsuit, which it vowed to contest vigorously.

As Celsius navigates the aftermath of its financial debacle, the ongoing distribution efforts stand as a testament to the complexities inherent in unwinding a cryptocurrency business of this magnitude. The resolution of these issues will undoubtedly have lasting implications for the broader crypto industry and its approach to regulatory compliance and creditor rights.