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The renowned U.S. cryptocurrency lending institution, BlockFi, was severely impacted by the bankruptcy of the cryptocurrency exchange FTX, which collapsed in November of the previous year. FTX assisted BlockFi in recovering from the liquidity crisis ignited by Three Arrows Capital, a $400 million credit line from its bankruptcy. Ultimately, in the same month last year, BlockFi formally applied for Chapter 11 bankruptcy protection in court and suspended customer withdrawals.
BlockFi Escapes Bankruptcy Protection
Eleven months after BlockFi filed for bankruptcy protection, the platform announced early on the 25th that BlockFi's bankruptcy plan had officially taken effect, and the company officially emerged from bankruptcy status on October 24th, Eastern Standard Time.
Reuters pointed out that BlockFi plans to cease operations, commence asset liquidation to repay cryptocurrency assets to customers and other creditors. The effective implementation of the bankruptcy plan also means that BlockFi will continue to seek claims from FTX, Three Arrows Capital, and other companies that owe assets to the platform. A successful lawsuit is expected to enhance customer compensation.
Wallet withdrawals are now open, including international users.
More importantly, BlockFi also announced that it is ready to begin prioritized repayment to some creditors. The platform claims, ""At present, almost all wallet customers can make withdrawals."" The official instructions state that customers who hold assets in their BlockFi wallets should log into the official BlockFi.com website and submit a withdrawal request. It should be noted that the wallet withdrawal window will close on December 31, 2023, at 11:59 PM (UTC). Eligible users must apply for withdrawals before this time.
Previously, under the authorization of the bankruptcy court, BlockFi prioritized withdrawals for eligible U.S. users in mid-August. Customers eligible for withdrawals include BlockFi wallet account holders who meet the following conditions and have not withdrawn or transferred digital assets worth more than $7,575 from their BlockFi Interest Account (BIA) or BlockFi Private Client (BPC) within 90 days prior to November 28, 2022, and did not hold any restricted trading assets in their wallets when the platform was suspended on November 10, 2022, at 8:15 Pacific Standard Time.
The BlockFi wallet withdrawal official Q&A has been updated to ""allow eligible international users to withdraw from BlockFi wallets."" The official has sent emails to all wallet users to let them know more about whether they qualify for the current withdrawal and the steps required to withdraw.
Interest and loan account compensation will commence no earlier than January 2024.
As for customers who have BlockFi Interest Accounts (BIA) and loans, the official goal is to initiate the withdrawal of part of the assets in early 2024. Subsequent distributions will also be made, but the amount of the funds will depend heavily on the outcome of BlockFi's bankruptcy litigation against FTX and the status of fund recovery.
According to court documents, BlockFi estimated that customers with BIA accounts are expected to recover 39.4% to 100% of the cryptocurrency assets in their accounts. |
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Post time 27-10-2023 14:38:21
