The Celsius bankruptcy payout to creditors is being delivered in phased rounds of Bitcoin, Ethereum, and stock in a new Bitcoin mining company called Ionic Digital, with cumulative liquid recovery now above 64% of each creditor’s July 13, 2022 dollarized claim value.{1Stretto. Celsius Network LLC, et al. Case Information} The U.S. Bankruptcy Court for the Southern District of New York confirmed the reorganization plan on November 9, 2023, distributions began on January 31, 2024, and a fourth round of $344.4 million was announced on January 22, 2026.
How Your Claim Amount Was Set
Your claim was frozen as of the petition date, July 13, 2022. Whatever sat in your Celsius account that day is what you’re owed, regardless of anything that happened to crypto prices afterward.{1Stretto. Celsius Network LLC, et al. Case Information}
Every claim was then converted to U.S. dollars using petition-date prices. Bitcoin was valued at roughly $19,881 and Ethereum at roughly $1,088. That dollar figure is the number your recovery percentage is measured against.
This matters for two reasons. First, if you held altcoins on Celsius, you are not getting those tokens back. Your claim was dollarized and you receive BTC and ETH worth a percentage of that dollar amount. Second, because BTC and ETH have risen substantially since July 2022, the market value of what you receive today can exceed your dollarized claim, even though the headline recovery percentage sits below 100%.
For most retail creditors, claims were automatically marked “Allowed” from Celsius’s own records, so you didn’t need to file separate proof to be paid in the early rounds.
What You Get Depends on Your Account Type
The plan split creditors into classes, and the class your account fell into is the single biggest factor in what you actually receive.
Earn Account Holders
Earn was the largest group, and it got the toughest treatment. In January 2023, the court ruled that crypto deposited into Earn accounts became Celsius’s property under the platform’s Terms of Use. That made Earn depositors general unsecured creditors with no priority claim to any specific assets. Recovery comes from the estate’s pooled assets and is paid as a mix of liquid BTC and ETH plus common stock in Ionic Digital.
Custody Account Holders
Custody fared better. The court approved a settlement giving participating Custody creditors the right to recover approximately 72.5% of their crypto-based claims, reflecting the argument that custody assets were still the depositors’ property rather than assets Celsius could freely use. You had to opt into the settlement to get that rate.
Withhold Account Holders
Withhold holders were treated under separate settlement terms negotiated during the case. As with Custody, participation in the approved settlement was required to receive the favorable treatment.
Disputed or Contingent Claims
If your claim was disputed, contingent, or unliquidated, it went into a reserve rather than being paid in the initial rounds. The estate’s Litigation Administrators work through those claims over time, and once yours resolves in your favor, you become eligible for supplemental distributions from released reserve funds.
What Has Been Paid and What Is Left
Payouts come in phases, each tied to newly available funds from asset sales, litigation recoveries, or the release of reserves for resolved disputed claims. Distributions are made only in BTC and ETH, not in any other cryptocurrency.{2Celsius Distributions. Distribution Calculation, Partners, Reporting, and Other Questions}
- First distribution (January–February 2024): Over $3 billion in crypto and fiat went out starting January 31, 2024, at a recovery rate of 57.65% of dollarized claims. Some creditors initially received 57.87%, which was later corrected.{}3Celsius Distributions. Second Distribution
- Second distribution (late 2024): An additional $127 million lifted cumulative recovery to about 60.4%, covering retail borrower deposit claims, general Earn claims, Withhold claims, unsecured loan claims, and general unsecured claims.
- Third distribution (August 2025): $220.6 million brought cumulative recovery to approximately 64.9%.{}4Celsius Distributions. Third Distribution
- Fourth distribution (February 2026): Announced January 22, 2026, this $344.4 million round is expected to be the final one paid in BTC. It draws from approximately $257 million in proceeds from the Tether adversary proceeding settlement, $73.7 million released from the disputed claims reserve, and $9.4 million from forfeited claims. Future rounds are expected to shift to U.S. dollars and stablecoins.{}5Celsius Distributions. Fourth Distribution
Reserved funds for disputed claims will continue to be released as those claims are resolved. Unclaimed distributions may eventually be returned to the estate for redistribution, so creditors who haven’t completed verification should not wait.
Your Ionic Digital Stock
Part of your recovery is common stock in Ionic Digital, Inc., a Bitcoin mining company owned entirely by Celsius creditors.{6Nasdaq. Celsius Emerges from Chapter 11 and Commences Distributions of Over $3 Billion of Cryptocurrency to Creditors} Hut 8 Corp. manages the mining operations under a four-year agreement.
As of early 2026, Ionic Digital shares are not listed on a public stock exchange. The company has said it expects to list on Nasdaq once its registration statement becomes effective, but no firm date has been set. Until then, the stock is illiquid: you cannot easily sell it or mark it to a market price.
Odyssey Trust is Ionic Digital’s transfer agent. You can register on the shareholder portal to view your holdings, and Odyssey’s shareholder services can be reached at ionicdigital@odysseytrust.com or 1-833-814-9451.{7Odyssey Trust. Ionic Digital Shareholder Portal}
How to Actually Receive Your Payment
Distributions are paid through Coinbase, PayPal, or Venmo. The administrative side is where most stuck payments live.
- Match your details exactly. Your name, email, and date of birth on Coinbase, PayPal, or Venmo must match the information on your Celsius account. Mismatches block payouts.{}8PayPal Newsroom. Supporting Celsius Creditors with Crypto Distributions
- Finish identity verification. PayPal and Venmo are available for U.S.-based creditors, and both require completed identity verification before funds can be released.
- Keep the receiving account active. A dormant or restricted Coinbase or PayPal account will hold your distribution. Log in, clear any compliance flags, and do it before the next distribution date.{}9Coinbase Help. Celsius Distribution
- Register with Odyssey Trust to see your Ionic Digital shares.
- Watch the Stretto case page for official distribution notices and timeline updates.
If your claim was previously disputed and has since been resolved, check whether it has been reclassified as “Allowed.” That reclassification is what makes you eligible for supplemental distributions from the reserve.
Taxes on Your Distribution
Celsius distributions create tax obligations, and the correct treatment depends on the approach you chose for recognizing your loss. Celsius reported account information to the IRS, so the agency has records of your platform activity.
If You Are Recognizing Losses Over Time
Each distribution is treated as a partial recovery. If you originally held BTC and received BTC back, the returned portion of your original asset may be treated as a non-taxable withdrawal carrying your original cost basis and holding period forward. Anything you receive beyond what you originally deposited in that asset is “new” and takes a fresh cost basis equal to its fair market value at distribution. Because recovery percentages remain below 100%, comparing each round to the allocated portion of your original cost basis often produces a capital loss.
If You Already Wrote Off the Loss
Some creditors elected to deduct the full Celsius loss in an earlier tax year, such as 2024. If that was you, every distribution you receive after that must be reported as income for the year you receive it. The February 2026 fourth distribution would be reported on your 2026 return, and the reported value becomes your new cost basis in the BTC received.
What to Watch for on Your 2026 Return
Whichever method you started with, stay consistent across rounds. The fourth distribution may be the last one paid in BTC, with future rounds shifting to dollars and stablecoins, which introduces different reporting considerations. A tax professional familiar with crypto bankruptcy distributions is worth the fee here.