BlockFi Withdrawal Could Resume
BlockFi, a cryptocurrency lender that declared bankruptcy on 28 November, has filed a plea with a US court to allow withdrawal for clients who have crypto locked in its wallet accounts.
The bankrupt firm filed the request with the US Bankruptcy Court for the District of New Jersey on 19 December. If authorised, members can withdraw the cryptocurrency stored on the site. According to the motion, cryptos are kept in wallets belonging to consumers, and the firm has had no legal or equitable interest since it ceased operations on 10 November.
In addition to permitting withdrawals from clients' wallets, the crypto lender is working to enhance the user interface to display transactions accurately. The corporation also intends to perform routine account reconciliation.
BlockFi withdrawal request applies to particular customers
To clear up any confusion, the firm aims to erase any "attempted" withdrawals from the user interface following the platform pause. The business also noted in the statement that to avoid all doubt, the debtors do not seek to reverse any customer deposits from outside the platform to wallet accounts received post the Platform Pause Time Stamp.
According to Twitter, the crypto company issued an email informing users of the recent court filing. It further stated that it believes clients clearly control their wallet accounts' digital assets.
“We will seek similar action from the Supreme Court of Bermuda concerning BlockFi Wallet Accounts maintained at BlockFi International Ltd”, the crypto lender added. This motion does not affect withdrawals or transfers from Interest Accounts currently in suspension.
BlockFi withdrawal halt stems from crypto crash
BlockFi was one of the first companies to fall victim to the early November crypto crash headed by crypto exchange FTX. The crypto lender arranged a $680 million transaction with FTX. As FTX's financial situation deteriorated, the impact on the US grew.
According to the company's bankruptcy filing, the corporation claimed more than 100,000 creditors and $1 billion to $10 billion in assets and liabilities.
Author: Emmanuel Baiden
7 years experience within the financial services sector most notably in Sales, Trading, research and writing articles within the crypto space. I have a bachelor's degree in International Business and a Master's in Investment and Risk Finance . I am also an associate member of the Chartered Institute for Securities and Investment.