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The Blockchain Recovery Investment Consortium (BRIC), a partnership between GXD Labs and VanEck, announced on Tuesday a significant development in Celsius’ bankruptcy case. Tether (USDT) has agreed to pay a major amount to the crypto lender’s bankruptcy estate following an adversary proceeding that was initiated last year.
Tether Settles Billion Dollar Lawsuit
This settlement marks a significant milestone in the ongoing legal saga surrounding Celsius, which filed for bankruptcy in July 2022.
Celsius had previously accused Tether of mishandling collateral and liquidations, claiming 39,542 BTC (approximately $4.3 billion at the time) along with an additional $100 million in damages, which constituted their largest third-party claim.
As previously reported by Bitcoinist, Celsius asserted that Tether’s actions exemplified a broader “scheme to exploit the US cryptocurrency market,” a position they believed could support jurisdiction in this case.
In response to the allegations, Tether characterized the lawsuit as a “shake down,” asserting that Celsius was responsible for providing additional collateral in light of fluctuating Bitcoin prices at the time. Tether maintained that Celsius’s mismanagement should not result in undue costs for them.
Significant Return For Celsius Bankruptcy Creditors
Ultimately, the settlement allows Tether to resolve the matter for a fraction of the initial amount claimed by Celsius, with nearly $300 million expected to be recovered, providing a notable return for creditors involved in the bankruptcy proceedings.
Tether CEO Paolo Ardoino also commented on the settlement on social media site X (formerly Twitter), stating, “Tether is pleased to have reached a settlement of all issues related to the Celsius bankruptcy.”
David Proman, Managing Partner of GXD Labs, also expressed satisfaction with the resolution. “We are pleased to have resolved Celsius’s adversary proceeding and related claims against Tether,” he stated.
Featured image from DALL-E, chart from TradingView.com
