BlockFi Archives

BlockFi users to get back $297M from Wallet accounts: Report

May 11, 2023 boss

A United States judge has granted permission to bankrupt crypto lender BlockFi to return $297 million to customers with deposits held in its Wallet program, Reuters reported on May 11. The return of funds does not apply to users of interest-bearing accounts (BIA). According to bankruptcy Judge Michael Kaplan, funds in BIA accounts were used by BlockFi for its lending business and therefore are property of the bankruptcy estates. This means the funds will be later used to repay all creditors. The Wallet program, in contrast, did not pay interest…

Crypto Lender BlockFi Customers Can Be Repaid $300M Held in Custodial Accounts, Judge Says

May 11, 2023

“The court finds that all digital assets held by the debtors in custodial omnibus wallets are indeed client property, and not property of the bankruptcy estates, subject, of course, to possible avoidance and clawback rights,” Kaplan said, but had less happy news for BIA customers. Source

Crypto lender BlockFi is granted extra time to file Chapter 11 exit plan

April 20, 2023 boss

BlockFi, a lender of digital assets, was given additional time to submit a bankruptcy exit plan by a New Jersey bankruptcy judge in the United States on April 19. The cryptocurrency lender filed for bankruptcy in November 2022 and has been reportedly granted a 48-day extension until May 15 to file an exit plan. The crypto firm is exploring a potential sale of company assets or the possibility of getting an outside backer to support a restructuring deal, BlockFi lawyer Joshua Sussberg said in a hearing Wednesday. According to the…

Circle and BlockFi questioned on banking with SVB by Warren and AOC

April 12, 2023 boss

Executives at the stablecoin issuer Circle and the bankrupt cryptocurrency lender BlockFi have been questioned by two members of Congress investigating the so-called “mutual backscratching arrangements” alleged to have taken place with the now-failed Silicon Valley Bank (SVB). On April 9, letters from Senator Elizabeth Warren and Representative Alexandria Ocasio-Cortez (AOC) were sent to Circle, BlockFi and 12 other non-crypto tech firms asking a series of questions on each firm’s relationship with SVB. The lawmakers stated that more needs to be known about SVB’s reported “coddling” and “white glove” treatment…

Sen. Warren, Rep. Ocasio-Cortez Ask Circle, BlockFi Why They Banked at Silicon Valley Bank

April 11, 2023

They have also been asked to provide information about the alleged “coddling” of any of their executives or board members by SVB, including details about financial relationships between the executives and SVB, any trips executives took that were sponsored by SVB, and whether any executive ever raised a red flag internally about SVB’s exposure to uninsured assets. Source

BlockFi to provide over $100K in refunds to California clients

March 28, 2023 boss

Bankrupt crypto lender BlockFi has agreed to refund more than $100,000 to California customers that had continued to repay loans even after a trading halt on Nov. 10 last year. According to a March 27 statement from California’s financial watchdog, the Department of Financial Protection and Innovation (DFPI), its investigation discovered at least 111 borrowers in California paid back roughly $103,471 in loan repayments between Nov. 11 and Nov. 22. The regulator claimed that BlockFi failed to “provide timely notification to borrowers that they could stop repaying their BlockFi loans.”…

Bankrupt Crypto Lender BlockFi to Refund More Than $100K to California Clients

March 27, 2023

The decision, which is subject to a bankruptcy court’s approval, comes after a DFPI investigation found the now-bankrupt crypto lender “failed to provide timely notification” to borrowers that they could stop repaying their loans after the company had paused withdrawals on its platform. As a result, BlockFi’s California borrowers remitted at least $103,471 worth of loan repayments to the lender’s servicer. Source

Bankrupt Crypto Lender BlockFi Given Go-Ahead for Sale of $4.7M of Mining Rigs

March 24, 2023

The majority of the 6,376 mining rigs BlockFi sold to U.S. Farms & Mining are Bitmain Antminers, according to a previous filing. They are spread across the U.S. – Texas, Georgia, Kentucky and North Dakota – as well as Norway. About 400 of the machines had come into BlockFi’s possession trough foreclosure. Source

BlockFi Bankruptcy Attorney Describes Digital Assets Lender as Safe amid Silicon Valley Bank Crisis

March 14, 2023

Christine Okike said BlockFi remains safe and looked to access significant cash held with Silicon Valley Bank yesterday. Despite the Silicon Bank exposure, a BlockFi bankruptcy lawyer maintains that the digital asset lender is safe and in no immediate danger. The lawyer, Christine Okike, stated that the embattled New Jersey-based company also has sufficient funds to continue normal operations. As Okike of Kirkland & Ellis said on behalf of BlockFi at a Monday bankruptcy hearing: “BlockFi is fine; we have access to cash to operate in the normal course, including paying employees…

BlockFi in no immediate danger, despite Silicon Valley Bank exposure: Report

March 13, 2023 boss

According to a lawyer representing the bankrupt crypto lender BlockFi Inc.,the company is in a stable financial position with access to ample cash reserves, despite having over $200 million in exposure to Silicon Valley Bank, Bloomberg reported. According to the report, BlockFi had $227 million invested in a money market mutual fund that Silicon Valley Bank marketed; nevertheless, the risk is probably related to the performance of the fund, not the bank’s financials. https://t.co/xsgWgQRsLy — Cointelegraph (@Cointelegraph) March 11, 2023 During a bankruptcy hearing on Monday, Christine Okike of Kirkland…