The bankruptcy proceedings for BlockFi, a crypto lending platform, have been granted court approval to move forward with their plan to cease operations.
Clients can expect to receive back 35-63% of the amount of debt owed to them, depending on the outcome of a legal dispute against FTX and Three Arrows Capital which has resulted in a total of $1 billion in claims.
The payments are expected to be carried out by the end of 2023, with some recipients receiving Bitcoin and Ethereum.
The proposed plan was supported by a committee representing the interests of customers and creditors after BlockFi settled a dispute over potential legal claims against their management.
The company’s top management has been accused of neglecting warning signs before extending the FTX loan.
Despite some complications during review, the committee believes that BlockFi is prepared to repay customer debts faster than other crypto firms undergoing reorganization.