BlockFi has approved the sale of FTX claims as part of its bankruptcy process, offering a positive outcome for creditors. This article details the implications of the sale and what it means for BlockFi customers.
Points
- Sale of FTX Receivables: BlockFi completes sale amid bankruptcy process.
- Significant Premium: Claims sold at a significant premium to face value.
- Customer Distributions: Plans for near-term final distribution to creditors.
- Bankruptcy Process: Successful liquidation and positive outcome for creditors.
- Global Impact: Details on international distributions and regulatory compliance.
Defunct centralized crypto lender BlockFi has approved the sale of FTX claims as its bankruptcy process nears completion. Mohsin Y. Meghji, the company’s plan administrator and also Managing Partner of M3 Partners, filed the sale with the United States Bankruptcy Court for the District of New Jersey.
BlockFi Completes the Sale of FTX Receivables
The sale process began on June 24 and closed on July 10 after the highest and best bid was determined “at a significant premium to their face value.” The claims were monetized through an undisclosed third party.
BlockFi reached an agreement in principle for $874.5 million with the heirs of FTX and Alameda Research in March. This settlement enabled the plan administrator to begin planning for subsequent distributions based on expected value to BlockFi creditors.
The sale will enable near-term final distribution of 100% of eligible customer and general unsecured creditor claims in fiat. “This transaction marks a final chapter in the liquidation and is the best possible outcome for BlockFi customers,” Meghji said.
These recoveries on customer claims and the timeline in which these recoveries would be distributed were unimaginable when these lawsuits were filed in November 2022. “We plan to begin end-customer distribution as soon as possible,” he said.
BlockFi shut down its web platform in May and announced last week that it would begin in-kind crypto distributions through Coinbase in July, with batch processing to occur in the coming months.
However, fiat requests from BlockFi customers are not processed by Coinbase. Eligible cash distributions are handled by Kroll and payment processing partner Digital Disbursements.
Customers outside the US are not eligible to receive funds at this time. “Distributions, particularly to BlockFi International creditors, may require additional identity verification and Know Your Customer diligence in accordance with international standards,” the firm said.
*This is not investment advice.
解説
- Successful Sale of FTX Receivables: BlockFi’s completion of the FTX claims sale marks a significant milestone in its bankruptcy process, offering a positive resolution for creditors.
- Premium Sale: The claims were sold at a significant premium, highlighting the value of the assets and the effectiveness of the sale process.
- Customer Distributions: The plan for near-term final distributions to eligible customers and creditors ensures that stakeholders will receive their claims in fiat, providing financial relief.
- Bankruptcy Resolution: The successful liquidation and positive outcome for creditors demonstrate effective management and strategic planning in navigating the bankruptcy process.
- Global Compliance: The detailed approach to international distributions and regulatory compliance underscores the company’s commitment to transparency and adherence to global standards.