Celsius was granted permission on Friday to start liquidating its altcoins, as the bankrupt crypto lender prepares a distribution to creditors that will take place solely in the two most widely used cryptocurrencies, Bitcoin (BTC) and Ether (ETH). Bankruptcy Judge Martin Glenn of the Southern District of New York approved the move, which was proposed by Celsius after discussions with the Securities and Exchange Commission (SEC). According to the ruling, Celsius “may sell or convert any non-BTC and non-ETH cryptocurrency, crypto tokens, or other cryptocurrency assets other than such tokens that are associated with Withhold or Custody accounts… to BTC or ETH commencing on or after July 1, 2023.”
Celsius has been in communication with the SEC and certain state regulatory agencies to ensure that all distributions of cryptocurrency are in compliance with applicable laws and regulations. The company is currently preparing an updated bankruptcy plan that, barring limited exceptions, won’t involve distributions of cryptocurrencies to creditors other than BTC or ETH. This comes after the SEC has taken action against major crypto exchanges such as Coinbase, Binance, and Bittrex, claiming that tokens linked to Polygon (MATIC), Near (NEAR), and Cardano (ADA) fall under securities regulation.