News

BlockFi’s Customer Repayment Plan Now Approved By Court

Key Points:

  • The US Bankruptcy Court approves BlockFi’s customer repayment plan for liquidation, raising hopes for them.
  • Creditors may receive 35% to 63% of their debts, some in Bitcoin or Ethereum.
  • The outcome of ongoing litigation, including disputes with FTX, could significantly impact creditor reimbursements.
In a significant development for customers of the beleaguered cryptocurrency lending platform BlockFi, the United States Bankruptcy Court in New Jersey has granted approval for its liquidation plan.
BlockFi's Customer Repayment Plan Now Approved By Court 2

BlockFi’s Customer Repayment Plan Receives Court Approval

The court’s decision, made during a hearing on September 26, marks a significant milestone in the company’s winding-down process, potentially allowing customers to recoup a portion of their investments by year-end.

The company’s third amended Chapter 11 plan received the green light from Bankruptcy Judge Michael A. Kaplan, who stated his approval during the hearing. BlockFi’s customer repayment plan, which had the backing of a committee representing customer interests and supportive creditors, paves the way for some BlockFi creditors to receive partial repayment in cryptocurrencies like Bitcoin or Ethereum, as per court documents.

Cryptocurrency Creditors Await Partial Repayments Amid Legal Battles

The expected recovery for unsecured BlockFi creditors ranges from approximately 35% to 63% of their owed amounts, as detailed in an August court filing. The final payout depends on the outcome of its legal battles with FTX and other bankrupt crypto firms. BlockFi has stated that the resolution of disputes with FTX and Three Arrows Capital could significantly impact creditor recoveries.

A court filing from September 25 noted that the settlement likely reduced additional administrative fees and expenses, thus preserving the overall recoveries for creditors. The committee expressed optimism that BlockFi’s customer repayment plan would begin this year.

BlockFi initially halted customer withdrawals on November 10, just prior to FTX’s bankruptcy. While initially aiming to restructure the business under Chapter 11, BlockFi determined earlier this year that liquidation offered the best avenue for repaying its customers.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.

Recent Posts

Dogecoin Price Gets $5 Prediction, Shiba Inu To Rally 1,100%, And ETFSwap (ETFS) To Jump 135x

Here are the latest predictions for Dogecoin, Shiba Inu, and ETFswap.

18 mins ago

AVAX Hits $1B in DeFi, Cardano Expected to Surge—BlockDAG Leads with $110M Presale & 100% Bonus!

Discover BlockDAG's 100% bonus and $110M presale surge that’s sparking interest among crypto enthusiasts. Also,…

18 mins ago

Crypto Institutional Investors Move To ETFSwap (ETFS) Amid $500 Million Liquidity Injection Expectations

Discover why crypto investors are moving to ETFSwap (ETFS) as $500 million liquidity injection is…

3 hours ago

Buyers Rush to Maximise Gains with BlockDAG’s 100% Bonus Offer; Plus, ETH Holds Strong as Solana Challenges Rivals

Learn about BlockDAG's $110M presale achievement and the whopping 100% bonus offer, alongside Ethereum's growth…

5 hours ago

Thai Police Corruption Case Involving Officers and Extortion

Thai police corruption exposed as officers extort millions in USDT from a Chinese man under…

8 hours ago

SafePal Telegram Wallet Launches with Swiss Bank Accounts and CeDeFi

SafePal Telegram Wallet allows 950 million users to create compliant crypto-friendly Swiss bank accounts, integrating…

9 hours ago

This website uses cookies.