BlockFi to Receive $874 Million in Settlement with FTX and Alameda

BlockFi and the bankrupt FTX have agreed on an "in principle" settlement that will see FTX paying BlockFi up to $874.5 million.

The settlement, awaiting approval from US Bankruptcy Judge John Dorsey, will include FTX forgoing millions in counterclaims against BlockFi.

Did you know?

Want to get smarter & wealthier with crypto?

Subscribe - We publish new crypto explainer videos every week!

What is Polkadot in Crypto? (DOT Animated Explainer)

SUBSCRIBE

ON YOUTUBE

BlockFi is set to receive $185.2 million for customer assets held on FTX.com and an additional $689.3 million related to loans that Alameda Research received from BlockFi.

A notable aspect of the agreement is that $250 million of the Alameda claim will be recognized as secured, ensuring this payment is a priority once the plan is approved and goes effective.

BlockFi's bankruptcy administrators have lauded the settlement as a superior outcome, emphasizing the benefits for BlockFi's customers and creditors:

<The plan> ensures that money reserved for litigation with FTX is directed instead to customer distributions.

The resolution between FTX and BlockFi emerges against a backdrop of mutual lawsuits and a complex web of financial entanglements.

BlockFi began its Chapter 11 bankruptcy process in November 2022, citing FTX's collapse as the leading cause. Since then, BlockFi has actively sought to reclaim funds.

As BlockFi navigates its post-bankruptcy phase, having reopened a wallet for customer withdrawals in October 2023, the future holds cautious optimism for stakeholders.

This settlement represents a critical juncture for both BlockFi and FTX, offering a pathway to resolution amidst the crypto industry's broader challenges.

As for FTX's post-bankruptcy situation, the collapsed crypto exchange has initiated a claims process for its major cryptocurrencies, causing dissatisfaction among investors, as the rates are significantly lower than current market values.

Aaron S., Editor-In-Chief

Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.
Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.
Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.

Full Bio

All Expert Contributors & Analysts