Bankrupt Celsius to spend $24M from GK8 sale on legal fees

After buying GK8 for $115 million in 2021, Celsius is selling it for $25 million, spending 96% of the sale proceeds in legal fees.< /p> News Join us on social networks

Bankrupt cryptocurrency lending company Celsius has asked the court to grant relief in the petition relating to the distribution of funds from its sale of self-custody platform GK8.

On July 17, Celsius Network Debtors filed a filing stating that its Series B holders have agreed to a settlement to distribute $25 million of the proceeds from the sale of GK8.

The agreement was reached between the Debtors, the Creditors' Committee and the original consenting Series B Preferred Holders.

According to the document, the shareholders proposed to allocate $24 million for legal costs and the remaining $1 million to be distributed among the holders.

"Given that the primary purpose of the settlement is to reduce administrative costs, the Obligors have agreed and continue to support the proposed allocation, which provides reciprocal benefits to the initial consenting Series B holders," says the folder. .

According to the court document, the settlement agreement was based on the "mutual desire" to avoid costly litigation and a lengthy confirmation process with a corresponding increase in professional fees. The folder says:

"The settlement not only unlocks tremendous value for debtors' creditors, but also provides debtors and all parties with invaluable certainty as to the path forward. For the reasons set forth herein and in the Petition, the court must dismiss the objections and grant the relief sought in the motion.”

As previously reported, Celsius acquired Israeli self-guard startup GK8 in late 2021 for $115 million. The struggling crypto lender was soon forced to sell GK8 as part of its restructuring plan after Celsius collapsed in 2022.