BlockFi, a cryptocurrency lending platform, has successfully exited bankruptcy and is in the process of making repayments to some of its creditors.
According to a recent blog post shared on October 24th, the platform has also reactivated withdrawal capabilities for a majority of its Wallet customers and outlined plans for future distributions.
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After overcoming its bankruptcy challenges, BlockFi is taking steps to reclaim assets it believes are owed by other companies, including crypto firms like Three Arrows Capital (often referred to as “3AC”) and the now-bankrupt FTX.
In the blog post, BlockFi informed its Wallet customers that they can now initiate withdrawals by logging into the app and submitting a withdrawal request. The team emphasized that this would help expedite the withdrawal process.
For customers with BlockFi Interest Accounts (BIA) or loans, the platform said it is preparing for initial distributions. The first round is expected to start in early 2024. However, the magnitude of future distributions will hinge on several factors, including the outcome of litigation with the FTX.
The company initially ran into financial troubles around the middle of 2022 when Terra’s stablecoin faced a downturn. To combat this, FTX offered a lifejacket in the form of a $400-million credit line.
However, FTX later filed for bankruptcy in November, dragging BlockFi down in its wake.
BlockFi’s resurgence from bankruptcy signifies a notable turnaround in its financial journey. The platform has not only resumed Wallet withdrawals for most customers but is also actively working on a timeline for distributions to its BlockFi Interest Account and Loan clients. As BlockFi continues to engage in legal proceedings to reclaim assets and repay creditors, its future actions will be closely watched by both the crypto community and regulatory authorities.
