Defunct Crypto Lending Platform Celsius Appealing Dismissed $444m Claim Against FTX

Now, defunct crypto lending platform Celsius has filed a notice of appeal against a judge’s order that disallowed its claims for damages from FTX as part of its ongoing bankruptcy case.

📢 Celsius vs. FTX: $2B Legal Battle Continues
Celsius has appealed the dismissal of its $2B defamation claim against FTX.

The case now moves to district court after allegations of reputational damage and financial loss tied to FTX executives. ⚖️

Stay updated on this pivotal… pic.twitter.com/mppSEXYl15

— MountainLion (@MLion_AI) January 2, 2025

Judge Throws Out Celsius’ Initial $2 Billion Claim Along With A Revised $444 Million Version

For the entirety of its legal proceedings, Celsius has been trying to claim back over $400 million from FTX. This figure is a reduction after initially claiming $2 billion in damages over alleged “disparaging statements” that FTX officers made against Celsius that sped up its decline.

Celsius later revised the claim to focus on “preferential transfers” that gave special treatment to some creditors and not others, claiming new damages of $444 million.

Even with the revised claims, Judge Dorsey disallowed both claims in December 2024. Dorsey found that Celsius’ original proofs of claim, which only contained a single sentence about investigating possible preference claims, were insufficient.

Yesterday (December 31), Mohsin Meghji, the litigation administrator for Celsius Network and its affiliated debtors, filed a notice of appeal regarding Judge Dorsey’s memorandum opinion and order.

In its first claim, Celsius claimed FTX officers made “unsubstantiated and disparaging statements” about its balance sheet and financial condition. In its amended claim, the firm called for $444 million in transfers to FTX entities to be returned to the bankruptcy estate.

Celsius filed a Notice of Appeal against Judge Dorsey's ruling for FTX debtor

Elected for Appeal to be heard in the District Court

Facts
1) Celsius Filed a $2bn claim for disparagement before the bar date

2) Celsius filed a $444m amended claim for a preference claim after bar… pic.twitter.com/evaBzMi5Lt

— Sunil (FTX Creditor Champion) (@sunil_trades) January 1, 2025

Since Entering Bankruptcy Celsius Have Paid Out Over $2.5 Billion To More Than 250k Creditors

The court ruled that Celsius’s amended proofs of claim filed in July 2024 were improper because the firm didn’t seek leave to amend, and the amendments were not sufficiently related to the original claims.

Judge Dorsey also stated that Celsius offered no explanation for the delay in filing and that the amendments would hinder FTX’s reorganization.

According to a court filing from August 2024, Celsius has repaid approximately $2.53 billion to more than 250,000 creditors. This figure represents approximately 84% of the assets owned by the now-bankrupt firm.

In November 2024, Celsius stated that it would distribute an additional $127 million to creditors from its litigation recovery account “soon.” As of January 2025, no further update has been made on the remaining funds to be distributed.

BONUS: Wall Street Pepe (WEPE) Carries Its Momentum Into 2025 As It Smashes Past $40 Million In Presale Funding

Presale’s flowing. Candles are growing. $WEPE ain’t slowing. 🐸 ⚔️ pic.twitter.com/vqHonzkn1v

— Wall Street Pepe (@WEPEToken) December 30, 2024

With over $40 million raised in less than a month, Wall Street Pepe (WEPE) has cemented its status as the hottest presale on the market right now. This success for WEPE is largely due to the strength of the OG frog coin, PEPE.

Over the festive period, while the market was largely in the red, PEPE stayed green. The OG frog is up over 13% in the past seven days, while its competitors have struggled. Shiba Inu (SHIB) is down nearly 1%, while Bonk (BONK) is down over 4% over the past week.

PEPE’s strength isn’t the only catalyst for the early success of Wall Street Pepe. This meme coin plays on the ever-popular Wolf Of Wall Street theme alongside Pepe the Frog. This combination means the branding and memeability are off the scale.

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EXPLORE: Grayscale Q1 2025 Portfolio Update: Spotlight on HYPE, ENA, VIRTUAL and More – Trends in Crypto

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Disclaimer

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