The crypto market has faced its worst situation last year. With certain major crashes of firms and coins, investors lost trust in the market. The prominent crash of the FTX led investors and Crypto whales to distress. The halt in withdrawals and frauds due to certain wrong decisions led to a chaotic situation in the industry.
BlockFi is a similar firm that was in pretty bad condition in 2022! After two weeks after the FTX crash, BlockFi went ahead to file for a Bankruptcy case. This Crypto firm is one of the major victims of the FTX collapse. Let’s find out more about this matter in detail!
What Is Up With BlockFi And Its Bankruptcy?
BlockFi filed for a Bankruptcy case after being unable to fix a missing calculation from their balance sheet. And this hole is not something minor that you can ignore. Rather, the amount of missing funds is worth about 8 million USD!
BlockFi is unable to show where this fund has been transferred. Analysts have found that BlockFi is on the major list of FTXs creditors. This indicates that the lost fund had been with FTX. If you are into a crypto investment, you may consider knowing about Malta And NFTs.
In the initial days of last year, this firm accepted a loan of about 400 million USD from FTX. This was to help the firm in surviving the liquidity crunch due to the TerraUSD meltdown! With this, FTX took hold of the exchange and supported liquidity for BlockFi.
Though it seemed to save the firm, both these firms came under the influence of this economic downturn. With this recent Bankruptcy case, many new facts are making their way out!
More Trouble For Cryptocurrency With BlockFi’s Bankruptcy
The full details of the bankruptcy and lost funds are not yet out. But certain facts are coming to the light now! BlockFi has over 100,000 creditors. And, the filing also brings forth that a client has over 28 million USD!
Though they are not high in comparison to that of the FTX, they cannot be ignored! It shows that FTX has spread the infection to all its affiliate companies too!
Court Permits The Firm To Sell Assets
While the Bankruptcy case of BlockFi is ongoing in the U.S. Bankruptcy court. On the plea of the company, the court issued orders that the firm can proceed to sell its assets.
The court states that under such circumstances it is reasonable to sell the assets. Also, it is fair and appropriate to do so under the conditions of bankruptcy.
The court also admits that it is a fair step to revive the lost assets during this step. And it will help in maximizing the recovery process.
With this green signal from the court, the firm is now sure to receive bids from different sources. For this, the firm is now all set to sell its mining assets to collect funds.
Rules To Join This Bid
Also, there are certain rules for this bid and a definite deadline that you need to consider if you want to buy these assets.
The document of the permission states that the eligible bids must reach the parties by the deadline. The deadline has been set for 20 February this year. Besides that, you need to file the bids with the respective court by 2 March.
Also, the representatives of the creditors can raise objections against the sale of these mining assets. But this objection against the eligible bidders needs to be done by 16 March.
Along with these, they need to submit a written proposal to all the co-counsel of all the debtors. You need to include your proposed purchase rates and your interested assets. Also, you need to mention the way of financing the assets.
How Will This Bid Be Carried Out?
Bloomberg has issued a report on this case. The report states that there’s a reason behind this tight deadline for the bid. Under this pressure and tight deadline, the firm expects to get more bids from different sources.
The firm wants to utilize the current market conditions. And for this, having funds is of utmost importance. This bid will help them in acquiring the necessary amount and revive while returning funds to their creditors.
It will be notable to watch the upcoming condition of BlockFi. Also, time will show how successful this bid will be!
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