The now-defunct crypto lender Blockfi has recently filed a court document outlining its plans to liquidate the company. The firm has come to the realization that selling the company would not be beneficial to its creditors. As a result, Blockfi has decided to take matters into its own hands and proceed with a self-liquidating transaction. Once the assets are distributed, the company will be wound down.
the community with a notice regarding its latest disclosure statement with the bankruptcy court. The update reveals that the crypto lender has made the decision to proceed with a self-liquidation transaction after several unsuccessful attempts to sell the business. With 660,000 client accounts, the top 50 creditors are owed $1.3 billion. However, there is a glimmer of hope for some, as the latest filing notes that certain classes of claims could potentially see recoveries “as high as 100%.
“The debtors are proceeding with the self-liquidation transaction whereby the debtors will distribute their assets to creditors in accordance with the terms of the plan, followed by a wind-down of their affairs,” the court document published on kroll.com details. Blockfi’s biggest hopes for recovery lie in obtaining assets owed by the bankrupt entities Alameda Research and FTX.
According to a court document, Blockfi has emphasized the importance of its employees in the company’s self-liquidation plan. The crypto lender has stated that the Blockfi platform was “developed in-house, [and] is written in a unique and esoteric programming language” that outsiders would have a difficult time understanding. Without the needed staff, “the debtors do not believe that the plan is feasible,” the court document discloses.
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