Ionic Digital Inc., a Bitcoin mining firm associated with former Celsius Network users, is facing potential liquidation as creditors raise concerns over management issues and financial delays. Originally set up to compensate Celsius customers, Ionic’s plans to go public have been hampered by significant setbacks.
Initially slated for a Nasdaq listing in 2024, Ionic has now pushed its IPO to 2025, exacerbating frustrations among its creditors. Recent disruptions, including the abrupt exit of its auditor, RSM US, in May, and the resignation of CEO Matt Prusak earlier this month, have further fueled doubts about the company’s future. These developments have prompted some creditors to consider liquidating Ionic’s assets and even replacing the board of directors.
In response to the liquidation threat, Gregory Pesce, a lawyer representing Ionic, assured that the company remains financially stable, boasting a positive cash flow and approximately $200 million in cash and cryptocurrency. He emphasized that Ionic is not pursuing any mergers or acquisitions and that no shareholder group currently holds enough power to enforce significant changes.
Despite these assurances, Ionic continues to face delays in hiring a new auditor, a crucial step for completing its public listing process. Additionally, the company’s Bitcoin mining operations in Ward County, Texas, have experienced slow progress, with only one of four planned facilities completed. This has led to criticism from creditors about the board’s experience and the pace of development.
As for Celsius Network’s bankruptcy proceedings, approximately $2.53 billion has been distributed to 251,000 creditors, covering 93% of claims. However, 121,000 creditors are still waiting for their payouts. The distribution process is ongoing, with funds being transferred via Coinbase and redeemable PayPal codes, but Ionic’s uncertain future adds complexity to the bankruptcy process.
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