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BlockFi Claims Against FTX, Alameda 'Largest Driver' of More Than $1B in Asset Recoveries, Firm Says
The litigation supporting claims against the bankrupt crypto lender's commercial counterparties is set to make a difference "in excess of $1 billion" to creditors, court filings say.
Fund recoveries for clients and creditors of bankrupt crypto lender BlockFi will depend heavily on the firm's claims against its commercial counterparties including FTX and Alameda, court filings from Friday show.
In its wind-down plan filed to the U.S. Bankruptcy Court for the District of New Jersey, BlockFi said that "the success or failure" of litigation supporting these claims "will make a difference of in excess of $1 billion" to clients waiting for their money back.
STORY CONTINUES BELOW
The plan also set out a list of projected recoveries, including liquidation of around $1.06 billion in BlockFi Inc. Interest Account Claims, $216 million in BlockFi Lending LLC Private Client Account Claims and $371 million in BlockFi International Ltd. Private Client and Interest Account Claims – though recoveries eventually received by clients "may differ materially" from projected figures.
"While recoveries will be based on a number of factors, the largest driver of higher recoveries are our claims against Alameda and FTX," the firm tweeted on Friday.
BlockFi has around $355 million in crypto frozen on FTX and another $671 million in a loan to FTX's trading arm Alameda Research, which are also going through chapter 11 wind-down proceedings in Delaware.
Last week, U.S. Bankruptcy Judge Michael Kaplan in New Jersey ruled BlockFi custodial wallet users can be returned nearly $300 million in funds owed. The liquidation plan filed on Friday "provides for the return of non-estate digital assets held in client wallet accounts in connection with the Wallet Program in full, subject to applicable set offs," the firm tweeted.
A hearing on the plan is set for June 20.
Read more: BlockFi Customers Can Be Repaid $300M Held in Custodial Accounts, Judge Says
Sandali Handagama
Sandali Handagama is CoinDesk's deputy managing editor for policy and regulations, EMEA. She is an alumna of Columbia University's graduate school of journalism and has contributed to a variety of publications including The Guardian, Bloomberg, The Nation and Popular Science. Sandali doesn't own any crypto and she tweets as @iamsandali
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Crypto Industry Asks President Trump to Stop JPMorgan’s 'Punitive Tax' on Data Access
A coalition of fintech and crypto trade groups is urging the White House to defend open banking and stop JPMorgan from charging fees to access customer data.
What to know:
- Ten major fintech and crypto trade associations have urged President Trump to stop big banks from imposing fees that could hinder innovation and competition.
- JPMorgan's plan to charge for access to consumer banking data may debank millions and threaten the adoption of stablecoins and self-custody wallets.
- The CFPB's open banking rule, which mandates free consumer access to bank data, is under threat as banks have sued to block it, and the CFPB has requested its vacatur.
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