BlockFi reaches $875 million settlement with FTX, Alameda Research
Quick Take The in-principle agreement to settle $874.5 million in BlockFi’s claims to collapsed FTX and Alameda will help the bankrupt lender to distribute funds to its customers if approved.
Bankrupt cryptocurrency lender BlockFi has reached a $874.5 million in-principle settlement with FTX and Alameda Research estates, according to a Wednesday bankruptcy court filing.
Upon court approval of the settlement, BlockFi — which was hit by the collapse of FTX in 2022 and filed for Chapter 11 bankruptcy soon after — will receive a customer claim against FTX worth $185.2 million and a claim of $689.3 million from FTX’s sister trading firm Alameda Research, according to the filing .
BlockFi customers are expected to receive the claims at full value, as long as FTX meets its distribution goals, the filing said.
Out of the $874.5 million, $250 million will be a secured claim, for which there is collateral to prioritize the payment to BlockFi after FTX’s reorganization plan is approved by creditors. “BlockFi ensures that it will receive that $250 million shortly after the FTX plan is confirmed and goes effective – likely allowing a second interim distribution in the near term,” the court filing said.
FTX filed its amended reorganization plan in December 2023, which the company said reflects compromises designed to provide the best outcome for all creditors and stakeholders.
Last month, a U.S. bankruptcy court approved a settlement between BlockFi and Three Arrows Capital, a crypto hedge fund that collapsed in 2022. While the approval settled counterclaims, details of the settlement remain undisclosed.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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