Defunct cryptocurrency lending platform BlockFi is set to start repaying its creditors in July, 19 months after filing for bankruptcy. The New Jersey-based firm announced that distributions will be processed “in batches in the coming months” via Coinbase.
BlockFi filed for Chapter 11 protection in November due to market volatility and its significant exposure to the collapsed FTX crypto exchange. The firm emerged from bankruptcy less than a year later and is now working on creditor repayments. Notably, non-U.S. clients are still unable to receive funds due to regulatory requirements.
In March, BlockFi stated that it is unlikely to fully repay customers with interest-bearing accounts, initially estimating recoveries between 39.4% and 100% of account value. This repayment plan highlights BlockFi’s efforts to rebuild trust in the volatile crypto market.
The strategic importance of these repayments lies in BlockFi’s attempt to stabilize and regain credibility in the crypto lending sector, which has been marred by recent collapses.
