Bankrupt BlockFi offers conversion of client assets into stablecoins for wallets
Date: 2023-08-30 Author: Karina Ziganova Categories: CRYPTO PAYMENTS, BUSINESS
BlockFi has received a court order that requires consent to convert certain client assets into withdrawable funds amid ongoing bankruptcy proceedings.
On August 30, the company filed in bankruptcy court, seeking permission to exchange limited “trade-only” cryptocurrency assets or other stablecoin-type assets. Assets held exclusively for trading account for less than half a percent of all BlockFi client funds. Except for Algorand, Bitcoin Cash and Dogecoine.
The technical restrictions that BlockFi is talking about prevent clients from withdrawing assets only for trading in their original form. If such a procedure is approved, then it will be possible to count on a one-time conversion of assets into Gemini Dollar or other stablecoins at the choice of BlockFi. Thanks to BlockFi, it became possible for customers to withdraw stablecoin funds through the platform.
According to the company, this step is necessary to facilitate the complex withdrawal of all assets of clients for storage. Last week, earlier court decisions reopened the BlockFi platform for customer withdrawals.
No date has been set for the hearing. The proposed order needs to be notified to clients who only own assets for trading purposes.
BlockFi and related entities filed for Chapter 11 bankruptcy protection at the end of November of this year. None.
The crypto lender used exposure to bankrupt hedge fund Three Arrows Capital and volatile fluctuations in the crypto markets as prime reasons for filing Non.
