Crypto-lending company BlockFi has announced that it has emerged from bankruptcy on October 24, 2023. The company’s customers and creditors could finally recover their funds, frozen since the collapse of FTX in November 2022.
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BlockFi’s restructuring plan a success
Declared bankrupt last year, the crypto-lending company BlockFi seems to have succeeded in its restructuring plan. Indeed, it has announced to have finally emerged from bankruptcy. To achieve this, the restructuring team at BlockFi only needed 11 months. It’s an undoubted success when you consider that some bankrupt crypto companies take years to do so, while others never succeed.
As a reminder, BlockFi and its eight subsidiaries declared bankruptcy on November 28, 2022, placing themselves under the protection of the notorious Chapter 11 of US law. The group’s bankruptcy was consecutive to the collapse of the exchange FTX.
According to the CCO of BlockFi, the company had a $400 million loan from FTX. Bankrupt, FTX had failed to return its funds, forcing BlockFi to suspend withdrawals.
End of BlockFi’s bankruptcy and hope for the company and its customers
Emergence from bankruptcy for BlockFi is excellent news for both the company and its customers. The company is now authorized to collect its debts from debtors such as FTX. In addition, the end of bankruptcy allows BlockFi to continue delivering digital assets to its customers. Finally, customers will be able to retrieve their funds, which have been blocked since November 2022.
On this last point, BlockFi has given precise guidelines. For customers holding funds in the BlockFi Wallet, they will have to submit a withdrawal request before December 31, 2023. From that date on, customers may gradually receive the funds claimed.
Customers holding funds in a BlockFi interest account (BIA) and those in connection with personal loans will follow an entirely different procedure.
Over the next few months, they will be sent an e-mail inviting them to withdraw their funds. However, repayment will be based on the amounts approved by the plan. After the initial repayment, customers will still have to wait… According to BlockFi, the additional reimbursement will depend on several factors, including the outcome of the trial FTX.
BlockFi’s rapid emergence from bankruptcy is an undeniable success that deserves to be applauded. We hope that the company’s customers, who are still waiting for their funds, will finally be able to breathe a sigh of relief.
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.