Stablecoin issuer Tether has agreed to pay $299.5 million to the Celsius Network bankruptcy estate, settling years of litigation tied to the crypto lender’s 2022 collapse. 

The payment is far below the nearly $4.5 billion Celsius originally sought in bitcoin.

The Blockchain Recovery Investment Consortium (BRIC) — a partnership between VanEck and GXD Labs — announced the settlement Tuesday, saying it settles “all issues” between Tether and the Celsius estate. 

“We are pleased to have resolved Celsius’s adversary proceeding and related claims against Tether,” said David Proman, managing partner at GXD Labs.

Tether and the Celsius collapse

The settlement ends one of the most contentious cases in crypto bankruptcy history. Celsius sued Tether in August 2024, claiming the stablecoin issuer improperly liquidated roughly 39,500 Bitcoin used as collateral before Celsius filed for bankruptcy in July 2022. 

Celsius said Tether violated an agreement requiring a 10-hour notice before selling the assets, costing the lender any remaining equity in the position.

Tether pushed back, calling the suit a “baseless shakedown.” The company said it acted within the terms of a 2022 agreement requiring Celsius to post more collateral as Bitcoin prices fell.

When Celsius failed to meet the margin call, Tether said it liquidated the bitcoin at Celsius’s direction to cover an $815 million debt.

A U.S. bankruptcy judge in New York allowed Celsius’s case to move forward earlier this year, though Tether denied wrongdoing.

The $299.5 million payment was arranged through BRIC, a joint recovery vehicle set up in early 2023 to pursue claims and recover assets from collapsed crypto firms. 

BRIC was appointed by the Celsius debtors and creditors’ committee in January 2024 to oversee asset recovery and litigation management, according to the BRIC release on the matter.

While the payment represents a win for Celsius creditors, it’s a modest one compared to the scale of losses from the company’s collapse.

Celsius, once one of the largest crypto lenders, froze withdrawals in mid-2022 amid plunging token prices and failed investments. Its bankruptcy exposed billions in customer losses and alleged mismanagement by top executives.

Former Celsius CEO Alex Mashinsky was sentenced in May to 12 years in prison for fraud and market manipulation. Prosecutors said he misused customer funds and inflated the price of the platform’s CEL token. In June, Mashinsky agreed to forfeit any claims to assets from the bankruptcy estate.

The Celsius collapse became one of the defining moments of crypto’s 2022 credit crisis, alongside failures at Voyager, BlockFi, and FTX.

The fallout triggered a wave of litigation and recovery efforts that continue to reshape how courts treat crypto lending and collateral agreements.