BlockFi Estate Clients Will Receive 100% of the Eligible Claims

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As a long-term crypto investor who has gone through the ups and downs of this volatile market, I have learned to be patient and stay informed about the latest developments in the industry. The news that BlockFi clients could receive 100% of their eligible claims is certainly encouraging, especially after the bankruptcy filing and the ongoing sale process of FTX claims.

In their most recent update, bankrupt crypto lender BlockFi disclosed that, depending on ongoing recovery work, all qualified clients may be fully reimbursed. This revelation was made public as BlockFi initiated the sale of its FTX claims this past week.

BlockFi to Pay From Proceeds of FTX Claims

In the first half of July this year, the FTX bankruptcy administrator, represented by BlockFi Estate, managed to sell the lender’s overdue FTX debt obligations for more than their original worth. Consequently, the BlockFi Estate is prepared to distribute 100% of the dollar equivalent value of approved customer claims as of the petition date.

Based on my extensive experience in the financial industry and having closely followed the developments at BlockFi, I believe that although the exact date for the settlement of claims with their clients has yet to be specified, the company is committed to prioritizing the safety and security of their clients’ assets. This commitment is reflected in their statement that they will work diligently on finalizing the distribution plan while ensuring the utmost protection for client funds. Furthermore, I have noticed that BlockFi has communicated to its US-based clients that they can expect to receive their final distributions within the next 90 days. These actions demonstrate a responsible approach and a strong commitment to transparency, which is crucial in building trust with their clients during this challenging period.

BlockFi is thrilled to share that, following the BlockFi Estate’s successful recovery process, clients are now anticipated to receive the full amount of their eligible compensation from the BlockFi Estate.

— BlockFi (@BlockFi) July 25, 2024

Eligible clients who want to receive crypto asset distributions need to set up a Coinbase account before August 23, 2024. Those who haven’t opened an account but have filed their claims with BlockFi by the deadline will instead receive their eligible distributions in cash.

International Clients Will Have to Wait Longer

International clients of BlockFi were notified that their distributions may be delayed due to regulatory necessities in Bermuda. This means extra identity checks and “Know Your Customer” (KYC) procedures will need to be carried out before distributions can be processed.

As an analyst, I would recommend that the Plan Administrator and Joint Liquidators take swift action to complete all necessary due diligence procedures in order to facilitate prompt distributions for all concerned parties. The crypto lender, on the other hand, should make it a priority to communicate effectively with their international customers, ensuring they provide the required information for due diligence and enable timely distributions.

Last month between June 24th and July 10th, BlockFi initiated and completed the sales process for its FTX claims. The crypto lending firm successfully reached over $874.5 million in principal settlements with both FTX and Alameda.

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2024-07-26 09:14