Court Allows BlockFi to Sell Mining Hardware to Pay Creditors

Bankrupt cryptocurrency lender BlockFi has received approval from a New Jersey County court to sell mining equipment to recover funds from affected creditors.

The court ruling dated January 30 indicated that, given the current circumstances, this sale of assets at auction would be appropriate.. All qualified bids must be sent to the parties mentioned in the bidding procedure no later than February 20. The court has until March 2 to receive proposals, and creditor representatives have until March 16 to object to the sale of BlockFi assets.

It is expected that after the approval of the court, the number of proposals submitted regarding BlockFi assets will increase. Therefore, potential bidders must send a written proposal to each lender's legal advisor before they are allowed to participate in the bidding process.. The application must specify the planned purchase price, the specific assets that the potential bidder is interested in acquiring, as well as the method of payment.

Last November, BlockFi filed for bankruptcy due to the collapse of the FTX exchange.. It turned out that the company's losses amounted to about $1.2 billion, and BlockFi owed money to more than 100,000 creditors.. Therefore, the company regards the court approval for the sale of its mining equipment as an important step that will speed up the return of client assets as part of the bankruptcy proceedings.

Recall that in February, BlockFi suspended the placement of cryptocurrency deposits for users from the United States due to claims from the US Securities and Exchange Commission (SEC) and other regulators.. The company was fined $100 million.