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<\/p>\nThe customers of bankrupt cryptocurrency lending platform BlockFi are one step closer to being paid out after a United States Bankruptcy Court in New Jersey approved its liquidation plan.<\/p>\n
Bankruptcy Judge Michael A. Kaplan approved BlockFi’s third amended Chapter 11 plan in a Sept. 26 court hearing, a filing on the same day shows.<\/p>\n
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The amount of repayment received by BlockFi’s unsecured creditors will largely depend on whether BlockFi succeeds in its legal battle against FTX and other bankrupt cryptocurrency firms.<\/p>\n
BlockFi filed its first liquidation plan to the bankruptcy court on Nov. 28 but was then required to submit a first, second and third amended plan in May. 12, June. 28 and July 31 respectively, court filings show. <\/p>\n
BlockFi’s liquidation plan was approved after the firm settled a long-fought dispute with the creditors committee over the company\u2019s senior management.<\/p>\n
A Sept. 25 court filing shows that the BlockFi creditors committee acknowledged that the settlement likely reduced additional administrative fees and expenses that could have cut into the recoveries. <\/p>\n
The now bankrupt lending platform blamed FTX’s collapse for its own failure despite the creditor’s committee citing concerns with BlockFi’s relationship with FTX and its former CEO Sam Bankman-Fried.<\/p>\n