BlockFi, the crypto lending platform that went bankrupt after the FTX crash, has secured more time to submit its bankruptcy plan.
BlockFi, the crypto lending platform that filed for bankruptcy in November 2022 after the FTX crash, has won a few more weeks (May 15) to come up with a plan to restructure its business and repay its creditors. A bankruptcy judge in New Jersey granted the extension until mid-May, saying it was worth a slight delay to ensure a smooth process.
BlockFi’s lawyer said the company is exploring options such as selling assets or finding an outside sponsor to support a reorganization plan. BlockFi owes between $1 billion and $10 billion to over 100,000 creditors, mostly its customers who deposited crypto on the platform and are now unable to withdraw it.
A committee of BlockFi users opposed the extension, arguing that there was no viable reorganization plan and that they should be given control of the case. They also demanded that BlockFi return the Bitcoin stored on the platform as soon as possible.
BlockFi is trying to recover over $1 billion from FTX and Alameda Research. It has $256.9 million in cash for its operations and restructuring.
BlockFi also said it is requesting approval from the court to restore withdrawal activities for those with BlockFi Wallet accounts. It also said it is forming an Official Committee of Unsecured Creditors, which will mainly consist of its clients.
The court allowed BlockFi to redact the names and contact information of its individual clients from the list of its 50 largest creditors.
