Bankrupt crypto lender BlockFi will commence its first interim crypto distributions to its creditors through Coinbase.
According to an announcement by the firm on X, the process would commence in July and continue in batches over the upcoming months. It noted eligible clients will be notified via the email associated with their BlockFi accounts. The company emphasized the importance of clients maintaining up-to-date email addresses associated with their BlockFi accounts to ensure timely receipt of distribution information.
However, the announcement highlighted a notable restriction: non-US clients are currently unable to receive funds due to regulatory constraints.
This move marks a significant step in BlockFi’s efforts to return funds to its clients following its bankruptcy filing in the wake of the FTX collapse in November 2022.
Following the shutdown of its web platform in May, BlockFi partnered with Coinbase to enable clients to access and withdraw their funds. The firm explicitly stated that it will not partner with any other providers for these distributions. For those unable to open a Coinbase account, the firm confirmed that distributions will be made in cash.
BlockFi’s efforts to return funds to its users reflect a broader trend in the cryptocurrency industry of addressing past crises and working to restore user trust. It coincides with resolutions in other high-profile cases, such as Mt. Gox.
The once-prominent exchange, which suffered a major hack in 2014, has finally begun repaying its users after over a decade of delays and legal proceedings. On July 5, 2024, the affected Mt. Gox users reportedly began receiving Bitcoin (BTC) and Bitcoin Cash (BCH) through their designated cryptocurrency exchanges as part of its rehabilitation plan.
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