In the ongoing Celsius bankruptcy saga, former CEO Alexander Mashinsky has agreed not to claim any assets from the company’s bankruptcy proceedings. The U.S. Bankruptcy Court for the Southern District of New York confirmed the agreement, marking a significant step toward ensuring more funds reach Celsius’s creditors.
On Monday, the court reviewed and approved a new agreement involving Celsius’s debtors, Mashinsky, and associated entities, including AM Ventures Holding Inc., Koala1 LLC, and Koala3 LLC. Under this deal, these parties are officially barred from receiving any distributions from Celsius’ bankruptcy estate.
As a result, funds that were previously held due to Mashinsky’s disputed claims can now be unlocked and made available for Celsius creditors. However, this stipulation will only take full effect after final court approval.
The court ordered that all crypto assets, cash, and Miningco shares held by Mashinsky and the involved entities must be released for redistribution. This decision clears the way for a wider distribution of remaining assets, bringing some relief to the thousands of creditors still waiting for their payouts.
Importantly, the court has retained jurisdiction over the case, meaning any disputes regarding this agreement must be resolved solely under its supervision. The court emphasized that no further claims from Mashinsky or his affiliated companies will be allowed without direct approval.
Celsius began the distribution process in 2024, releasing over $3 billion in cryptocurrencies and fiat currencies to eligible creditors. Despite this progress, over 121,000 eligible users have yet to claim their rightful distributions.
While some creditors expressed satisfaction after receiving their assets, many have faced delays and complications. According to recent figures from 2025, $1 billion has already been reclaimed by over 251,000 creditors, but a substantial number are still waiting for access to their funds.
This latest court order follows Mashinsky’s 12-year prison sentence for securities and commodities fraud tied to his actions at Celsius. By relinquishing all claims to the bankruptcy proceeds, the path is now clearer for Celsius creditors to receive what they’re owed.
Why It Matters for Crypto Investors
The Celsius bankruptcy continues to be one of the most high-profile collapses in the crypto space. With Mashinsky officially out of the picture, this move is likely to boost confidence in ongoing asset recovery efforts. Investors are hoping this milestone accelerates the process for those still waiting to reclaim their digital assets.
Celsius Network, a crypto lending platform, paused withdrawals in June 2022 due to “extreme market conditions,” filed for Chapter 11 bankruptcy in July 2022, and subsequently wound down operations after restructuring. Its former CEO, Alex Mashinsky, was sentenced for fraud.
Celsius Network filed for Chapter 11 bankruptcy on July 13, 2022, after pausing customer withdrawals due to “extreme market conditions.”
Celsius has committed to a total recovery of 79.2% of the total claim value, primarily paid in BTC, ETH, and Ionic Digital Stock. The exact amount depends on individual claims. Sources
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