Bankrupt crypto lender BlockFi is now completing its wind-down of operations. The firm also revealed its intention to shut down its web platform in May.
BlockFi has partnered with Coinbase to allow clients to access and withdraw funds. In a recent blog post, the company stated that the collaboration will enable “eligible BlockFi Interest Accounts (BIA), Retail Loans, and Private Clients” to withdraw their funds.
In November 2022, BlockFi declared bankruptcy following FTX’s collapse. In 2023, BlockFi announced its closure and outlined plans to return customers’ crypto holdings, with a withdrawal request deadline set for April 28, 2024.
Clients who missed the withdrawal deadline were informed on Thursday, May 9, that they would receive instructions on setting up a Coinbase account to facilitate withdrawals. Those who do not establish an approved Coinbase account may have their assets liquidated into cash and distributed accordingly.
The plan administrator will continue to use Coinbase for future distribution rounds, potentially involving recovered funds from FTX.
BlockFi emphasised that it does not plan to partner with any other platforms for cryptocurrency distributions and warned investors to remain cautious to avoid scams from third-party entities.
In March, BlockFi reached an $875 million settlement with the estates of FTX and Alameda Research, resolving BlockFi’s claims against FTX. BlockFi’s CEO, Zac Prince, testified as a government witness in Sam Bankman-Fried’s criminal trial, attributing FTX founder’s actions to BlockFi’s bankruptcy.
BlockFi’s bankruptcy plan, approved in September 2023, aims to repay its 10,000 creditors, with estimates suggesting debts of up to $10 billion to over 100,000 creditors.