The U.S. Securities and Exchange Commission (SEC) has postponed payment of BlockFi’s $30 million penalty until all creditor claims against the crypto-lending platform have been fully satisfied.<\/p>\n
According to court documents<\/a>, the Commission proposed reclassifying the amount due to it as a \u201cgeneral unsecured claim\u201d. The SEC declined priority payment of the penalty in order to \u201cmaximize the distribution to investors and avoid delays\u201d.<\/p>\n The agency preserved all rights regarding BlockFi\u2019s claims. The remaining amount of $50 million, which the SEC was entitled to as a result of settling claims against the platform<\/a> in February 2022.<\/p>\n In November BlockFi filed for bankruptcy<\/a> in accordance with Chapter 11 of the U.S. Bankruptcy Code<\/a>. The SEC ended up among the company\u2019s largest creditors. Their number exceeded 100,000 with aggregate claims of more than $1 billion. The platform valued its assets at $256.9 million.<\/p>\n At the time, founder of Hodder Law, Sasha Hodder, told CoinDesk that paying the penalty would be a priority for BlockFi.<\/p>\n \u201cClients are really at the bottom of the list,\u201d she said.<\/p>\n<\/blockquote>\n In May 2023, the court allowed the company to return to clients about $300 million<\/a> held in custodial accounts.<\/p>\n Subsequently, management announced a planned liquidation<\/a> of the platform after a failed sale.<\/p>\n\n