BlockFi Urges Non-U.S. Creditors to Claim Assets Before May 15 Deadline

BlockFi, the bankrupt cryptocurrency lending firm, has urged its creditors to come forward and claim their bankruptcy distributions before the May 15 deadline. According to a blog post released by the company, less than half of its non-U.S. customers have claimed their assets, while 97% of U.S. customers have already done so. The discrepancy in claim rates is attributed to the more complex process involved in distributing assets to non-U.S. customers, which required coordination with courts in both the U.S. and Bermuda.

BlockFi filed for bankruptcy in November 2022 following the collapse of FTX, which sent shockwaves through the crypto industry. The firm later announced a plan in July 2024 to distribute 100% of the dollar value of customers’ claims at the time of the bankruptcy filing. However, the process has been hindered by a lack of response from non-U.S. customers, who may be hesitant to engage due to concerns about the legitimacy of the communications they receive.

BlockFi has been working with security experts to reassure customers that the messages requesting them to select a payment method are genuine and not phishing attempts. The firm has emphasized the importance of completing the 'Know Your Customer' (KYC) identity verification process, which is a requirement for all customers to receive their distributions. This process, which involves submitting two forms of ID, takes approximately ten minutes to complete. Once approved, customers can expect to receive their payments within 45 days.

The bankruptcy code stipulates that any unclaimed assets by the May 15 deadline will be redistributed among other unsecured creditors. BlockFi has urged all customers who have not yet claimed their distributions or completed the KYC process to do so promptly to avoid missing out on their rightful assets. The firm has reiterated its commitment to making final distributions to all former customers, emphasizing the importance of timely action to ensure a smooth and efficient process.