Celsius Scores Major Win: Court Greenlights $4B Bitcoin Recovery from Tether

Celsius just landed a legal knockout punch—and the crypto world is buzzing.

The bankrupt lender secured court approval to claw back a staggering $4 billion in Bitcoin from Tether, marking a pivotal moment in its restructuring saga. This isn’t just a win for Celsius creditors; it’s a seismic shift in crypto’s high-stakes game of financial chicken.

The $4B question: Can they actually collect?

Tether, the stablecoin giant with a reputation for brushing off critics like crumbs from a black turtleneck, now faces real pressure. If Celsius pulls this off, it’ll be the biggest crypto asset recovery in history—and a stark reminder that even 'stable' players aren’t immune to legal reckoning.

Why this matters beyond the balance sheet

The ruling sets a precedent: Courts are willing to follow crypto trails across the blockchain jungle. Expect hedge funds and bankruptcy vultures to take notes—while Tether’s lawyers burn the midnight oil.

One cynical footnote? The irony of a 'stablecoin' empire potentially bailing out a failed yield-chasing scheme. Crypto’s circle of life continues to fascinate—and terrify.

The disputed 57,000 BTC between Tether and Celsius

At the center of the case is more than 57,000 BTC, which Celsius claims were either improperly seized, liquidated prematurely, or transferred in excess of agreed terms. The firm argued that if these assets had been retained, their current value WOULD exceed $4 billion.

Considering this, the court filing divided the bitcoin transactions Celsius is seeking to recover into three categories, including:

• Collateral Return Shortfall: Celsius originally posted 16,737.27 BTC as extra collateral to cover falling crypto prices in mid-2022. Tether returned only 1,079.06 BTC, leaving 15,658.21 BTC in dispute. Celsius argues these were preferential payments made to Tether to cover existing debt and are therefore recoverable under bankruptcy law.
• Cross-Collateral Transfers: Celsius posted 10,700 BTC to secure new USDT loans in a separate deal. The firm now claims 2,228.01 BTC were excessive and should be returned.
• Unauthorized Liquidation: The most significant portion of assets involves Tether’s sale of 39,542.42 BTC on June 13, 2022, allegedly executed without honoring a contractual 10-hour notice period. Celsius alleges Tether sold the BTC to itself at a discount, causing over $100 million in immediate losses.

Celsius claimed these transactions unfairly improved Tether’s position as a creditor, allowing it to recover nearly the full value of its $812 million loan while other creditors were left behind.

Other parts of the case

While the judge allowed core claims to proceed, the court dismissed other portions of the complaint. These include claims against specific Tether entities due to a lack of personal jurisdiction and allegations that depend on applying US bankruptcy law outside the country.

The court also ruled that Celsius failed to prove Tether breached duties under British Virgin Islands law, particularly regarding good faith and fair dealing.

Nonetheless, this ruling gives Celsius a green light to pursue what could become one of the crypto industry’s most consequential asset recovery cases.