BlockFi nears final distribution after selling FTX claims

BlockFi has announced the sale of FTX claims, allowing for near-term final distribution of 100% to all permitted customer and unsecured creditor claims.

BlockFi’s plan administrator has announced the sale of FTX claims, paving the way for a full recovery for customers and creditors. In a press release shared with crypto.news, BlockFi’s plan administrator, Mohsin Y. Meghji, hinted that the sale of all claims against FTX marks the “final chapter” in the liquidation process.

“This transaction is the best possible outcome for BlockFi customers. The customer claims recoveries and distribution timeline were unimaginable when these cases were filed in November 2022.”

Megji

The sale follows a March 2024 settlement with bankrupt cryptocurrency exchange FTX that provided BlockFi with over $874 million in damages against both FTX and its subsidiary Alameda Research.

Following this agreement, the scheme administrator has received approval to monetise these claims via a third-party sale. The press release also notes that BlockFi International creditors may require additional identity verification and KYC compliance in line with international standards.

The announcement follows BlockFi’s recent announcement that it would begin paying creditors in July, nearly two years after filing for bankruptcy amid FTX’s collapse. The New Jersey-based company said distributions would be made through Coinbase “in batches over the coming months,” and that eligible customers would receive notifications in their BlockFi account emails.

However, customers outside the US will still not be able to receive funds due to regulatory restrictions, and there is no specific timeline for these refunds. BlockFi filed for Chapter 11 protection in November 2022 following market turmoil and significant exposure to the FTX exchange.