Celsius Network debtors have submitted a plan for a sale to investment advisor NovaWulf Digital Management, a new filing reveals. According to the document, small creditors could get around 70% of their funds back in liquid crypto, while more significant creditors would become shareholders in the new entity.

Celsius Network Debtors Choose NovaWulf

Debtors of the collapsed Celsius Network have presented a sale plan to the digital asset investment firm NovaWulf Digital Management, according to a Wednesday filing with the U.S. Bankruptcy Court of the Southern District of New York. The move represents a part of an overall restructuring plan for the crypto lender’s retail platform and mining operations, backed by the official committee of unsecured creditors (UCC).

According to the filing, most smaller creditors – those with less than $5,000 in their lending accounts – would receive roughly 70% of their crypto funds back. On the other hand, larger creditors would become shareholders in the new company.

“Earn Creditors with claims valued below $5,000 on the petition date will be placed in a “Convenience Class” that will receive a one-time distribution of liquid crypto (in the form of BTC, ETH, and USDC) on the plan effective date. The Debtors estimate that the Convenience Class will provide over 85% of Celsius’ customers with a recovery equal to ~70% of their claim in liquid crypto.”

– the new filing said.

The debtors believe that the NovaWulf plan offered the best way to distribute the debtors’ liquid crypto funds and maximize the value of their illiquid assets. Launched in 2021, NovaWulf is an investment firm founded by former Wall Street dealmakers.

NovaWulf to Invest $45m – $55m in the New Entity

The reorganization plan comes in the wake of the Debtors’ court-approved sales process that Celsius lawyers had outlined last month. The lawyers said that Celsius is looking to reinvent itself as a new, publicly listed “recovery corporation” to get out of the bankruptcy process.

The bankrupt crypto lender attracted interest from 40 parties and received nine bids – six for its retail platform and three for its mining business. According to the plan, the new owners will invest between $45 million and $55 million in the business and intend to launch new divisions such as trade finance, private wealth services, factoring, and debt cards, among others.

Earlier this month, a filing showed that Celsius Network users could withdraw around 94% of their eligible assets. The embattled crypto lender won the ownership of over $4.2 billion of user funds in January.

This article originally appeared on The Tokenist

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