Why 37 million Celsius bankruptcy shares are blocked from an immediate cash-out despite Nasdaq debut

On July 28, Ionic Digital, which acquired Celsius Mining assets after Celsius Network’s bankruptcy, began trading on Nasdaq under the ticker IOND. The direct listing created a public market for existing Class A shares, including shares issued in connection with the Celsius bankruptcy plan, but it did not automatically let every holder of creditor-linked stock sell.Because this was a direct listing, Ionic sold no shares and would receive no proceeds if existing registered stockholders sold theirs. The transaction created a trading venue and price discovery for existing equity rather than raising new capital for Ionic.Where the creditor-linked shares came fromThose shares originated on Jan. 31, 2024, when Ionic acquired Celsius Mining assets. According to the company’s final prospectus, Ionic paid no cash consideration for those assets and instead issued 37 million Class A shares to former approved creditors of Celsius Network and certain subsidiaries and affiliates.Ionic reported approximately 82,000 stockholders of record before the listing, excluding beneficial owners whose shares were held in nominee names. The prospectus did not say how many of those record holders were Celsius ...