Customers at financially-mired crypto lending firm BlockFi are now able to withdraw funds for the first time in months following an order from a US bankruptcy court.
In an update posted today on X, BlockFi revealed that it had resumed withdrawals for eligible users in the States in accordance with court approval.
It tweeted: “This is an important step forward toward our goal of returning funds to clients. Through this process, our top priority is making distributions as quickly, efficiently, accurately, and safely as possible.
“We encourage all clients to check their email or BlockFi app to see if they are eligible at this time. We expect more clients, including international clients, to become eligible to withdraw digital assets from their Wallet accounts as we move forward in the Court process.”
Who is eligible?
According to BlockFi, the lender has “sent an email and is currently displaying an in-app banner to all eligible clients”.
BlockFi adds: “As authorized by the Court in the Wallet Order, at this time, eligible clients include U.S-based BlockFi Wallet account holders who:
- Did not withdraw or transfer more than $7,575 worth of digital assets from their BlockFi Interest Account (BIA) or BlockFi Private Client (BPC) on or after November 2, 2022.
- Did not hold any trade-only assets in their Wallet at the time of Platform Pause on November 10, 2022, at 8:15 P.M. E.T.”
In last year’s crypto bloodbath, BlockFi was one of many companies that filed for Chapter 11 bankruptcy protection in the United States last year, most notably the FTX exchange, Celsius Network, and Voyager Digital.
The crypto lender hit the pause button on withdrawals in November 2022, but filed motions the next month to return user funds.
BlockFi reported earlier this month that the bankruptcy court had conditionally given the go-ahead on its restructuring plan, saying it hoped to recover funds from FTX, Alameda Research, Three Arrows Capital, Marex, Emergent and Core Scientific “to maximize recoveries for clients, and defending against claims by third parties, which threaten to massively dilute clients”.
It added: “Success or failure in these matters will make a positive or negative difference to client recoveries of over $1 billion, which is an order of magnitude larger than any other issue facing BlockFi and its clients.”
