BlockFi Estate Withdrawal Process Will Refund $500 Million To Customers

Key Points:

• BlockFi completes the first wave of crypto asset returns, totaling $500 million for 130,000 clients.
• The US Bankruptcy Court grants BlockFi Estate withdrawal, enabling the start of interim distributions for remaining products in February.

BlockFi, dedicated to providing financial services in the cryptocurrency space, fulfilled requests from nearly 130,000 clients, restoring over $500 million worth of crypto assets.

BlockFi Successfully Completes $500M Crypto Asset Return to Clients

Today, BlockFi announces the commencement of the next phase of distributions, aiming to bring further relief to its clientele.

On January 22, 2024, the company successfully concluded the return of crypto assets from its Wallet Product, marking a significant milestone in the resolution of client claims.

In a pivotal development, the United States Bankruptcy Court for the District of New Jersey, on January 17, 2024, granted the necessary relief, enabling BlockFi to initiate interim distributions. Starting in February, clients utilizing BlockFi’s remaining products, including the BlockFi Interest Account (BIA), loans, and private clients, will have the opportunity to initiate BlockFi Estate withdrawal requests.

It is essential for claimants to have an allowed claim to be eligible for distribution. Those who have filed claims still pending reconciliation and approval will become eligible upon the successful resolution of their claims.

This initial wave of distributions for the specified products is expected to see BlockFi return between 20% and 40% of eligible clients’ allowed claims. The company remains optimistic about additional recoveries from the FTX estate, which will serve as the source for further distributions to clients upon receipt.

Is BlockFi Estate Withdrawal Instant?

The BlockFi Estate withdrawal process will be conducted in batches, with clients receiving detailed instructions via email when they become eligible to initiate withdrawal requests.

Notably, this development follows a precedent set in the insolvency case of FTX, where customers and creditors with verifiable losses were assured of a full reimbursement.

BlockFi’s commitment to returning assets in kind and the court’s favorable decisions underscore a positive trend in ensuring the financial stability of affected parties in the cryptocurrency sector.