The crypto-lending platform BlockFi expects to complete testing to open, this summer, the possibility for some clients to withdraw funds. The Block reports.
“Soon we will allow withdrawals of digital assets from BlockFi Wallet accounts that are not subject to creditors’ priority claims,” — the letter to clients says.
Payouts will be made in batches. Those eligible will receive a special notification from the platform.
BlockFi advised users to create external wallets to carry out such withdrawals.
11 November 2022 the company suspended withdrawals, citing the FTX and Alameda Research crisis. A few days earlier, founder Flori Marquez assured that all of the company’s products were operating, and that the business did not depend on the firms of Sam Bankman-Fried.
28 November BlockFi and eight subsidiary structures filed for bankruptcy in accordance with Chapter 11 of the United States Bankruptcy Code.
Earlier, in May 2023, a court allowed the company to return $300m to clients whose assets are held in custody accounts. The court did not classify this amount as the platform’s property.
Subsequently, management announced a planned liquidation of the platform following the failed sale.
The amount of redress to clients largely depends on the outcome of ongoing proceedings against the collapsed cryptocurrency exchange FTX and Alameda Research, as well as the bankrupt hedge fund Three Arrows Capital.