The voting results are in for the Celsius Chapter 11 reorganization plan. Across all creditor groups, acceptance rates were very high – around 98-99%. This signals strong approval for the current proposal.
Disclosure: Everything in this article is our (TheDroidGuy’s) interpretation of what the voting results were. You must make your own interpretation by reading the press release to make your own conclusion. Everything written in this article is for informational purposes only. Please do your own research and make your own conclusions. Do NOT make any financial decisions based on this article.
Retail borrowers, the convenience class, and those with Earn accounts overwhelmingly voted yes. Only a small fraction opted out of the proposed third-party releases or class action.
Voting Results by Creditor Class
|Creditor Class||Accepted Plan||Rejected Plan|
This lack of major opposition is a positive sign as Celsius moves toward finalizing its plan.
Toggle Elections: More Opted For Crypto
|Creditor Class||More Equity||More Crypto|
Creditors had the option to toggle their distribution between more crypto or more equity. The default was a mix of both.
Fewer than 5% of borrowers and Earn account holders toggled to all equity and no crypto. In contrast, 26% of borrowers and 17% of Earn members toggled to extra crypto.
This aligns with community sentiment favoring crypto returns over equity in the new company. Users seem cautious about Celsius’ future business prospects.
Meanwhile, 15% of creditors opted to contribute claims to the litigation trust. This is lower than some expected, likely due to confusion over the implications.
Retail Clawbacks: Mixed Response
Among the 391 users facing potential retail clawbacks over $100k withdrawals, 28% requested more info on repaying claims from Celsius.
The majority appear to be opposing clawbacks. But over a quarter seem willing to settle. This could result in disputes down the road.
Approximate Recoveries Based on Toggle Choices
|Election||Crypto %||Equity %||Total %|
|Borrowers – More Equity||0%||78%||78%|
|Earn/Withhold – More Crypto||40%||26%||66%|
|Borrowers – More Crypto||58%||0%||58%|
Here is how recoveries shake out for each creditor group and toggle election:
- Borrowers who toggled to 100% equity will get ~78% back in equity only.
- Earn/withhold members who toggled to more crypto will get ~40% in crypto and 26% in equity, totaling ~66% returned.
- The default distribution for Earn/withhold is ~37% crypto and 30% equity, totaling ~67%.
- Borrowers who toggled to more crypto will get ~58% back in crypto only and zero equity.
So extra equity delivers the highest total return percentage, while extra crypto returns more funds in kind but with slightly lower total recovery.
These estimates may change based on crypto prices near distribution time. But they provide a helpful benchmark.
What Happens Next?
The confirmation hearings beginning October 2nd are the next milestone. This is when objections will be heard and debated before final plan approval.
If all goes smoothly, initial distributions could start in November. Equity transfers may follow in early 2024.
Celsius still has work ahead rebuilding trust and restarting operations after Chapter 11 concludes. For now, creditors anxiously await the first funds.
Key Takeaways for Creditors
While votes are technically non-binding, participation provides important feedback to the court. Users should continue monitoring developments in the confirmation process.
Votes can also be changed later if new information arises. For now, creditors simply await more news on exact timelines and transfer details.
The confirmation hearings will determine if major disputes derail the current plan. If not, account holders hope funds could flow back to them soon.
After a long and complex journey through Chapter 11 so far, Celsius customers are eager to finally regain some access to their frozen assets.