After the successful bankruptcy restructuring of the cryptocurrency lending platform Celsius, which was once valued at $3 billion, Celsius Network began token burning operations on April 30th, destroying up to 94% of its holdings of $CEL tokens.
In July 2022, the cryptocurrency lending platform Celsius, previously valued at $3 billion, filed for Chapter 11 bankruptcy restructuring in the United States. They proposed a restructuring plan called the “MiningCo Transaction” to establish a company focused on Bitcoin mining in order to improve the repayment plan for their creditors. The plan was approved by the court in December of last year and officially emerged from bankruptcy in January, distributing over $3 billion worth of cryptocurrency and fiat currency to Celsius’ creditors.
It is worth mentioning that Celsius submitted an application in September 2023 stating their plan to burn all of their holdings of $CEL tokens upon the effective date of the restructuring plan.
On April 30th, Celsius Network began its token burning operations, destroying its holdings of $CEL tokens. According to information from Etherscan, Celsius completed this token burning by sending 6.522 billion $CEL tokens to a burn address. The amount burned accounted for 94% of the previous total supply, totaling 6.928 billion $CEL tokens. Based on the current market price, the value of these tokens is approximately $415 million.
After this transaction, according to data from CoinGecko, the remaining supply of $CEL tokens decreased to approximately 40.6 million. Additionally, according to data provided by Arkham, the token sending transaction originated from a wallet controlled by Celsius, confirming that the sending address indeed belongs to Celsius.
In the restructuring plan, Celsius asserts that regardless of how they ultimately decide to handle these tokens, they believe that each $CEL token should have a specific financial value, estimated at $0.25 per token.
Celsius emphasized that they can only burn the tokens they hold and emphasized that they cannot “cancel” all $CEL token transactions or halt exchange trading. Therefore, after the news broke, $CEL experienced a staggering surge starting from April 30th, with a 291% increase within a week, rising from $0.13 to $0.58. The daily increase remained at 90%, and as of the time of writing, it is temporarily reported at $0.5899.
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