Customers of bankrupt cryptocurrency lending platform BlockFi are one step closer to receiving compensation after the U.S. Bankruptcy Court in New Jersey approved its liquidation plan.
Bankruptcy Judge Michael A. Kaplan officially recognized A document filed on the same day showed that BlockFi revised its Chapter 11 plan for the third time at a court hearing on September 26.
The amount of repayment received by BlockFi’s unsecured creditors will largely depend on BlockFi’s success in its legal battles with FTX and other bankrupt cryptocurrency companies.
BlockFi’s liquidation plan was approved after the company resolved a long-running dispute with a committee of creditors over the company’s senior management.
The now-bankrupt lending platform blamed FTX’s collapse on its own failures, even as a committee of creditors raised concerns about BlockFi’s relationship with FTX and its former CEO Sam Bankman-Fried.
related: BlockFi asks court to allow trade-only assets to be converted into stablecoins
BlockFi is estimated to owe as much as $10 billion to more than 100,000 creditors, including $1 billion to its three largest creditors and $220 million to bankrupt cryptocurrency hedge fund Three Arrows Capital.
This is a developing story and more information will be added as it becomes available.
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