BlockFi shuts down platform, partners with Coinbase for payouts

BlockFi, which is currently defunct as a business house, plans to close the shutters of its web platform towards the end of the month, link up with Coinbase, and use the company’s services as a distribution associate. 

As an integral component of the bankruptcy claims procedure, the modification guarantees uninterrupted access to withdrawals for BlockFi Interest Account (BIA), Retail Loans, and Private Clients.

Crypto-deserving clients will have the option of accessing their funds in cash if they possess an open or consented Coinbase account. This factor applies to crypto-eligible clients who have not withdrawn crypto from BlockFi’s web platform before April 28. It also relates to whether they have authenticated their identification by May 10.

Cash will be disbursed to crypto-eligible customers who have not yet established a Coinbase account or are unable to do so.

BlockFi issued a warning to users regarding fraudulent activities and emphasized that it has not formed any partnerships with other cryptocurrency companies for distribution purposes.  

BlockFi’s bankruptcy situation has a plan administrator who could carry out the task of distribution via Coinbase, along with the ones connected with money retrieved from FTX. 

As of March, BlockFi had anticipated receiving approximately $875 million from FTX. Priority is given solely to the initial $250 million; the remaining amount is contingent on FTX’s capacity to remunerate customers in its own regard.

With Coinbase out of the picture, according to BlockFi, the plan administrator can only distribute cash going forward, not cryptocurrency. 

BlockFi initially requested a cessation of withdrawals on November 10, 2022, attributing its closure to a ‘lack of clarity’ regarding FTX’s distinct bankruptcy. A few weeks later, BlockFi initiated bankruptcy proceedings, during which FTX was identified as its second-largest creditor. 

In October 2023, BlockFi emerged from bankruptcy and commenced user payments this year.

Roxanne Williams

Roxanne Williams has recently joined as a market reporter for CryptoNewsZ - the 24/7 crypto news site, where she produces recent stories, technical analysis and price updates on world's leading cryptocurrencies.

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