Celsius Pursuit of Mashinsky Highlights Crypto Customer Fortunes

A new lawsuit against Celsius Network’s criminally indicted co-founder may reap benefits for some crypto customers already set to receive payouts that would make creditors in most corporate bankruptcies jealous.

Litigation winnings recovered from Alex Mashinsky and other former leaders of the bankrupt crypto lender would add to the 67% to 85% recovery customers are expected to receive on the debts they’re owed under Celsius’ court-approved restructuring plan. That rate is high for low-ranking creditors—a class the crypto customers technically fall into—in Chapter 11.

WeWork’s bankruptcy plan, for example, will pay at most 1% back to the company’s unsecured creditors, ...