BlockFi seeks legal approval to return funds to BlockFi Wallets users

BlockFi filed a motion to get approval to resume the withdrawal of the funds to its wallet users. 

BlockFi was a popular crypto lending platform but failed to provide smooth lending services because the majority of the funds of this company were under the custody of FTX Exchange, which collapsed badly. On 12 Nov, FTX filed for bankruptcy and later BlockFi filed for bankruptcy on 28 Nov. 

On 19 Dec, the BlockFi team filed a motion in the bankruptcy court of New Jersey. Through this motion, the bankrupt Crypto lender seeks to get legal approval to return the funds of all of its users, who were holding funds on the BlockFi wallet.

It is worth noting that BlockFi will not release funds for those who were holding funds as an investment in the BlockFi interest accounts. In short, it will be a type of relief for the BlockFi users who were holding some or significant funds on the BlockFi wallet. 

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Tiffany Fong, a crypto blogger, shared information that she collected from BlockFi via email conversation and confirmed that bankruptcy proceedings of BlockFi are faster than Celsius, which filed for bankruptcy approximately 5 months ago.

WOW, @BlockFi has already filed a motion requesting client withdrawals for assets held in BlockFi Wallet Accounts. S/O to BlockFi for moving exponentially more quickly than @CelsiusNetwork in Ch 11. pic.twitter.com/JvtWzMklNA

— Tiffany Fong (@TiffanyFong_) December 20, 2022

Initially, BlockFi filed for bankruptcy on 28 Nov but before that platform suspended funds withdrawal for the users on 10 Nov, just before the FTX bankruptcy filing. 

Today, BlockFi filed voluntary cases under Chapter 11 of the U.S. Bankruptcy Code.https://t.co/adaAx6me4r

— BlockFi (@BlockFi) November 28, 2022

When FTX fully collapsed with all of its affiliated companies on 8 November, then many experts claimed that BlockFi had some significant exposure to FTX but at that time BlockFi said that there was no significant exposure to FTX. 

pic.twitter.com/zNF1uP6evl

— BlockFi (@BlockFi) November 11, 2022

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BlockFi seeks legal approval to return funds to BlockFi Wallets users

 

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