In a significant announcement, BlockFi has opened the doors for both its U.S. and international user base, permitting them to initiate withdrawal requests. The crypto lending platform, BlockFi, has successfully navigated its way out of bankruptcy and is now poised to reimburse a portion of its creditors, as indicated in an October 24 blog post. The post highlights that withdrawals are presently accessible to nearly all Wallet customers, with a specific mention of BlockFi Interest Account (BIA) and Loan customers, who can anticipate withdrawing some of their assets early in 2024.
The post further elaborates that BlockFi’s resurgence from bankruptcy empowers it to actively pursue the recovery of assets from other companies it believes are indebted to it. These include insolvent crypto platforms like Three Arrows Capital, also known as “3AC,” and FTX. The organization is also committed to facilitating the distribution of assets to its creditors and expediting the claims process.
To ensure a seamless withdrawal process, the team has provided clear instructions for Wallet customers with assets on BlockFi. They are encouraged to log into the app and submit their withdrawal requests, which will initiate the withdrawal procedure. As for BIA and Loan customers, BlockFi is diligently preparing for the initial distribution in alignment with the bankruptcy plan. The first distribution is expected to take place in early 2024, with subsequent distributions contingent upon BlockFi’s success in the FTX bankruptcy litigation and various other factors.
BlockFi, a crypto lending platform, encountered liquidity challenges in the midst of 2022 when Terra’s stablecoin faced a crisis. FTX came to the platform’s rescue with a substantial $400-million credit line. Unfortunately, FTX succumbed to insolvency in November, consequently pulling BlockFi into the whirlpool. On August 17, a U.S. court authorized BlockFi to repay its U.S.-based Wallet customers, following the approval of a plan to wind down the company and repay its creditors. Notably, U.S. customers were not allowed to withdraw at that time. In a recent update found in BlockFi’s Wallet withdrawal FAQ, international users have now been granted the ability to make withdrawals.
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