TLDR
- Tether pays $299.5 million to settle Celsius Network bankruptcy claims over Bitcoin collateral liquidations from 2022
- Settlement resolves dispute managed by Blockchain Recovery Investment Consortium, formed by VanEck and GXD Labs
- Original lawsuit sought approximately $4 billion from the stablecoin issuer
- Celsius exited bankruptcy in 2024 after distributing over $3 billion to creditors
- Payment represents one of the largest recoveries in the Celsius wind-down process
Stablecoin issuer Tether has reached a $299.5 million settlement with the Celsius Network bankruptcy estate. The payment resolves claims related to Bitcoin collateral liquidations that occurred before Celsius collapsed in July 2022.
The Blockchain Recovery Investment Consortium announced the settlement this week. BRIC is a partnership between asset manager VanEck and GXD Labs, which operates as an affiliate of Atlas Grove Partners.
Celsius filed suit against Tether alleging improper liquidation of Bitcoin collateral. The collateral backed loans denominated in Tether’s USDT stablecoin. According to the complaint, Tether sold the Bitcoin when its price closely matched the value of Celsius’s outstanding debt.
This liquidation effectively wiped out Celsius’s position. The company argued this action contributed to its eventual insolvency.
From $4 Billion Claim to $300 Million Settlement
The settlement amount falls far short of Celsius’s original demands. The crypto lender had sought roughly $4 billion in total claims against Tether through court proceedings.
Celsius filed its adversary proceeding against Tether in August 2024. A bankruptcy court approved the lawsuit to move forward in July 2025. The relationship between this settlement and ongoing proceedings remains unclear.
BRIC was established in early 2023 specifically to maximize recoveries from failed digital asset platforms. The consortium received its appointment as asset recovery manager and litigation administrator in January 2024. This came after Celsius emerged from bankruptcy protection.
Celsius Collapse Part of 2022 Crypto Crisis
The Celsius bankruptcy was one of several major failures that rocked the crypto industry in 2022. The cascading collapses triggered a prolonged bear market across digital assets.
Other major lenders including BlockFi and Voyager Digital filed for bankruptcy protection during the same period. Genesis Global Capital followed in 2023. The crisis ultimately preceded the high-profile collapse of FTX later in 2022.
Former Celsius CEO Alex Mashinsky faced criminal prosecution. He was sentenced to 12 years in prison on two felony counts. Mashinsky agreed not to claim any assets from the bankruptcy estate and reported to prison in September.
The Federal Reserve Bank of Chicago documented the extent of the crisis. Customers withdrew nearly $13 billion from crypto platforms between May and November 2022. High-yield products offering interest rates above 17% attracted customers during the bull market but collapsed when prices fell.
Celsius completed its bankruptcy exit in 2024. The company distributed more than $3 billion to creditors during the wind-down. BRIC continues managing a portfolio of illiquid and litigation assets connected to the failed lender.
The joint venture previously attempted to acquire Celsius assets. Those assets ultimately went to rival bidder Fahrenheit in 2023. The $299.5 million Tether settlement was finalized in U.S. Bankruptcy Court for the Southern District of New York.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
