- Defunct crypto lender BlockFi has successfully exited bankruptcy and will soon process customer withdrawal requests
- Only those using non-interest-earning programs can apply for the time being
- BlockFi went into administration in November last year and will be liquidated after bankruptcy proceedings are seen to
Defunct crypto lender BlockFi has revealed that has exited bankruptcy and will soon start to process customer withdrawal requests for those who weren’t part of its interest-earning program. A press release detailing BlockFi’s rehabilitation plans saw it boast that it had exited bankruptcy “more quickly and efficiently than many other retail crypto companies,” which is an odd accolade to give itself but one that will no doubt please customers. The company announced a withdrawal window lasting until the end of the year, with the company set for liquidation after this.
Wallet Users Can Request Funds
With its emergence from bankruptcy, for which it filed in November last year, BlockFi can now begin implementing the actions outlined in its bankruptcy plan, the most important of which is repaying creditors. These actions encompass the company’s efforts to recover assets owed by entities like FTX and Three Arrows Capital, as well as the ongoing distribution of digital assets to clients, including BlockFi Interest Account (BIA) holders. The company will also continue the claims reconciliation process to ensure fair and equitable distributions of assets to clients.
Withdrawals are currently available to nearly all BlockFi Wallet holders, and BlockFi has encouraged them to log in to BlockFi.com to submit withdrawal requests. Eligible customers have until December 31, 2023 to submit their withdrawal requests.
BIA Users Must Wait
However, BIA and loan customers will have to wait longer for their initial distribution of assets from the wind-down estate, given that these funds were loaned out to third parties to accrue the interest. This presents two problems: BlockFi needs to get them back and the funds were technically BlockFi’s rather than customers’. BlockFi says that its Plan Administrator and remaining employees are working diligently to prepare for this distribution, with an aim to commence it in early 2024. Subsequent distributions will depend on factors such as any recoveries from FTX and its affiliates.
BlockFi revealed in May that, having failed to find a buyer, it will go into liquidation once it has taken care of all the bankruptcy requirements.