Crypto Lender Celsius Receives Court OK for Account Transactions and Airdrop of Flare Token

According to various court rulings filed on Tuesday, insolvent cryptocurrency lender Celsius Network received permission to handle some customer transfers.

One was authorized by American Judge Martin Glenn. Celsius is permitted, under certain restrictions, to restore monies sent to the site after the business filed for bankruptcy on July 14, 2022, by the Bankruptcy Court for the Southern District of New York. Another permits an airdrop of Flare tokens to qualified owners of XRP secured on the network.

Following a court session on Tuesday, the lender's attorneys presented a strategy to pay back money to creditors who had assets locked up over a specific amount by issuing a token. Other consumers, who according to the lawyers make up the majority of the debtors, would get a one-time payment in liquid cryptocurrency. The U.S. has not yet given its assent to the scheme. Office of the Trustee or other authorities.

Customers are permitted to withdraw monies provided to the site in the cryptocurrency form “net of any gas fees or transaction expenses” after the insolvency petition dates. If the transfer amount is greater than $40,000 (and the transferor earned over $200,000 from Celsius within the three months prior to the bankruptcy filing), the withdrawal must be authorized by the designated creditor committee.

A second order authorized a Flare token airdrop to qualified debtors and was also signed by Judge Glenn. After a two-year wait, Flare released tokens to XRP holders earlier this month. Flare had originally intended to be a decentralized finance (DeFi) service that utilised XRP tokens. Those who qualify for the airdrop and therefore should receive one token for each XRP kept should have held at least one XRP at the moment of a snapshot in December 2020, which captured the elements of a blockchain ledger at a specific time.

The distribution of Flare tokens to Celsius account holders who held XRP at the moment of the snapshot is permitted by the court order. It is possible for Celsius to acquire 150 million of the tokens, which on Wednesday were worth about $0.04.

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