BlockFi, a platform specializing in cryptocurrency lending, recently made a significant announcement that it is now facilitating fund withdrawals for both U.S. and foreign users from their BlockFi wallets. This development marks a crucial step forward as the company emerges from bankruptcy.
Post-Bankruptcy Progress For BlockFi
In a blog post published on Monday, BlockFi revealed that nearly all Wallet customers can now initiate withdrawals from their accounts. This milestone follows the approval of the company’s reorganization plan by a U.S. bankruptcy court in August.
Initially, withdrawals were restricted as BlockFi had filed for Chapter 11 bankruptcy protection on July 11, 2023, after experiencing challenges linked to the collapse of the crypto exchange FTX and hedge fund Three Arrows Capital.
Asset Distribution and Recovery Steps
With BlockFi’s exit from bankruptcy, the company can proceed with the distribution of assets to creditors and process claims. Importantly, the company is now legally empowered to pursue the recovery of funds owed to them by third parties. This includes FTX and Three Arrows Capital.
BlockFi has provided clear instructions for wallet users to initiate withdrawals. The company advises users to log in to the app and submit their withdrawal requests, and they will process them accordingly.
The fund withdrawals for loan customers and BlockFi Interest Accounts (BIA) distributions are not yet available. The company anticipates that initial payouts will commence in early 2024.
BlockFi’s CEO on the Path Forward
BlockFi’s CEO, Zac Prince, emphasized the company’s eagerness to build a trustworthy business that serves its clients. He noted the importance of continuing to gain the trust of clients who have relied on BlockFi’s services. The company also committed to providing additional information regarding withdrawal availability soon.
The ability for the majority of BlockFi Wallet users to initiate cryptocurrency withdrawals is a substantial breakthrough in the company’s recovery journey. While it signifies progress, the path to creditors receiving reimbursements remains an extended one.