BlockFi And FTX Reach Settlement

March 7, 2024 9:28 pm Comments

BlockFi and FTX have finally settled the ongoing claims dispute between the two bankrupt firms.

FTX has agreed to pay BlockFi $874.5 million in claims in a long-standing debt owed to the bankrupt firm. BlockFi will use the money to pay creditor claims and to make injured parties whole.

Additionally, FTX will drop its claims against BlockFi as part of the settlement terms.

This move could potentially wipe out BlockFi’s counter-claims and position the company for a successful restructuring.

CoinDesk explained:

Under the settlement, BlockFi will receive a total of $874.5 million in claims against FTX and Alameda Research. $250 million will be treated as a secured claim, which will prioritize payment to BlockFi after FTX plan to end bankruptcy, which was filed in December, is approved by its creditors.

Mr. Purple broke down the settlement in this lengthy thread detailing the original settlement amount and the ensuing settlement agreement terms between FTX and BlockFi.

The Block added:

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.

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