Crypto lending firm BlockFi, which filed for bankruptcy in 2022 following the collapse of crypto exchange FTX, announced Monday the successful sale of its FTX ClaimsThis marks another step towards the completion of BlockFi’s bankruptcy process, allowing for the final distribution of funds to creditors.
According to Monday’s report announcementThe sale of the FTX receivables was made at a “substantial” premium to their face value, which the plan administrator said was intended to ensure a “near-term” final distribution of 100% to all permitted customers and general unsecured creditors.
“The best possible outcome for customers”
BlockFi Plan Administrator Mohsin Y. Meghji revealed in the announcement that he has filed a report with the United States Bankruptcy Court for the District of New Jersey, confirming the closing of the transaction that monetizes all claims against FTX.
Meghji believes this is the “best possible outcome” for BlockFi customers, even saying it has exceeded expectations from the start. bankruptcy The first applications were filed in November 2022. Meghji added:
…These results, achieved through the tireless efforts of various parties, are remarkable. We intend to begin distribution to the end customer as soon as reasonably possible.
As reported By Bitcoinist, in March 2024, BlockFi reached a settlement with FTX and the bankrupt cryptocurrency exchange’s trading arm, Alameda Research, allowing BlockFi to receive $874.5 million in claims against them.
This settlement paved the way for future distributions to BlockFi customers based on anticipated FTX distributions. A significant aspect of the settlement was the ability for the plan administrator to monetize FTX claims through a sale to a third party.
BlockFi Platform Down, Reimbursement Progressing
Just one month ago, in June, the Plan Administrator determined that a sale of FTX claims at a level that maximized customer returns and generated significant recoveries for subordinated creditors was feasible.
The sale process commenced on June 24, 2024 and closed on July 10, 2024, with the acceptance of the highest and most advantageous offer. Interestingly, the purchase price exceeded the face value of the FTX receivables, providing substantial value to BlockFi and its creditors.
It was also disclosed The BlockFi platform is no longer active and any “in-kind” distributions will be facilitated through the plan administrator’s collaboration with Coinbase. Following this, users reported receiving notifications from the US-based exchange indicating a successful match between their credentials and BlockFi’s data.
However, despite the sense of progress in the bankruptcy proceedings of the failed crypto lender, Bitcoinist also reported On July 19, while many customers expressed excitement and viewed the refund development as positive news, some remained skeptical and stressed the need to see the funds deposited into their Coinbase accounts.
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