BlockFi is nearing the end of its wind-down and plans to make customers whole, nearly 20 months after filing for bankruptcy amid the FTX contagion.
“This transaction marks a final chapter in the wind-down and is the best possible outcome for customers of BlockFi,” said Mohsin Meghji, plan administrator of BlockFi and managing partner of advisory firm M3 Partners, in a Monday announcement.
“These recoveries on customer claims, and the timeline those recoveries will be distributed on, were unimaginable when these cases were filed in November 2022,” Meghji said. “These results, achieved through tireless efforts by various parties, are remarkable. We intend to commence the Final Customer Distribution as quickly as reasonably practicable.”
Meghji was referring to claims the company had against FTX, the crypto firm which collapsed in spectacular fashion earlier in November 2022 and brought down a number of other crypto firms — and around a million creditors — with it.
A March settlement with FTX allowed Jersey City, New Jersey-based BlockFi to receive $874.5 million in claims against FTX and FTX affiliate Alameda Research.
The FTX settlement gave Meghji the option to monetize the FTX claims through a sale of the claims to a third party, according to Monday’s announcement. After a sale process from June 24 to July 10, the purchase price on those claims was a “substantial premium to the[ir] face value,” BlockFi said.
BlockFi, which filed for bankruptcy in November 2022, ceased operations in May. Distributions will be made through crypto platform Coinbase.
In May, FTX announced that it, too, would make most customers whole.
