BlockFi Finalizes Sale of FTX Claims Amid Bankruptcy Proceedings Completion

• Recently, BlockFi, a restructured central crypto lender, confirmed the sale of its FTX claims as it nears the conclusion of its bankruptcy process.
• The sale was conducted through an undisclosed third party and fetched a premium over nominal values.
• Mohsin Y. Meghji, BlockFi’s plan administrator and M3 Partners’ Managing Partner, reported the sale to the U.S. Bankruptcy Court for the District of New Jersey.

BlockFi completes the sale of FTX claims, steering towards closing its bankruptcy proceedings and facilitating imminent client distributions.

BlockFi FTX Claims Finalized

The sale of BlockFi’s FTX claims, initiated on June 24, concluded on July 10, following the selection of the highest and best offer which came with a significant premium over their nominal values. This transaction has allowed BlockFi to convert claims into cash via an undisclosed third party.

Impact on BlockFi Creditors and Clients

Back in March, BlockFi established a principle agreement worth $874.5 million with the legacy entities of FTX and Alameda Research. This agreement is crucial, as it permits the plan administrator to commence planning for subsequent distributions to BlockFi creditors based on the expected value, thus laying the groundwork for eventual client reimbursements.

Facilitation of Client Distributions

This sale accelerates BlockFi’s ability to execute near-term final distributions in fiat currency to all eligible customer and general unsecured creditor claims. Meghji hailed the transaction as a pivotal move towards concluding BlockFi’s liquidation, providing customers with the best possible outcome under the circumstances.

Timeline and Execution of Payouts

The payment schedule and customer claim recoveries, once virtually unimaginable at the onset of these legal proceedings in November 2022, are now set to commence as soon as possible. BlockFi aims to initiate final customer distributions promptly, marking a significant milestone in their liquidation journey.

Operational Adjustments and Distribution Channels

In May, BlockFi shut down its web platform and recently announced the start of in-kind crypto distributions via Coinbase, expected to be processed collectively over the coming months. However, it’s important to note that BlockFi clients’ fiat claims are not managed by Coinbase. Instead, these will be handled by Kroll and their payment processing partner, Digital Disbursements.

International Client Distribution Challenges

Currently, the firm’s clients outside the United States are not eligible to receive distributions. BlockFi mentioned that distributions to international creditors may require additional identity verification and rigorous adherence to Know Your Customer (KYC) standards in line with international regulations.

Conclusion

To sum up, BlockFi’s progress in selling its FTX claims signifies a substantial step towards the finalization of its bankruptcy process. By securing a premium on the claims and initiating a structured plan for creditor distributions, BlockFi is on track to deliver the most favorable outcomes for its clients and creditors amid complex operational challenges.

The post BlockFi Finalizes Sale of FTX Claims Amid Bankruptcy Proceedings Completion appeared first on COINOTAG NEWS.