BlockFi’s Asset Claims: A Call to Non-U.S. Customers
Less than half of the non-U.S. customers of the now-bankrupt cryptocurrency lending firm BlockFi have stepped forward to reclaim their assets as the impending deadline of May 15 approaches. This announcement was made in a blog post by the company on Wednesday.
BlockFi initially filed for bankruptcy in November 2022, following the widespread turmoil caused by the collapse of the FTX exchange, which sent shockwaves throughout the crypto industry. After navigating through the bankruptcy process, BlockFi successfully emerged and revealed a plan in July 2024 to distribute 100% of the dollar value of customers’ claims as of the bankruptcy filing date.
To date, an impressive 97% of U.S. customers have successfully claimed their distributions. In stark contrast, only 43% of non-U.S. customers have come forward to claim their assets. This disparity can be attributed to the comparatively complex process for non-U.S. customers, which involved judicial oversight in both the United States and Bermuda, making the distribution process more challenging.
One possible explanation for the low response rate among non-U.S. customers is the perception that communications from the BlockFi Estate, which urge customers to select a payment method, are spam or phishing attempts. To combat this issue, BlockFi has been collaborating with security experts to validate the authenticity of these communications and instill confidence in its customers.
“BlockFi is committed to ensuring that all former customers receive their rightful distributions,” the blog post stated. “Customers who have not yet received their distributions or completed the necessary procedures are strongly encouraged to finalize the required steps by May 15, 2025.”
It is important to note that both U.S. and non-U.S. customers were required to complete a ‘Know Your Customer’ (KYC) identity verification process to utilize BlockFi’s services initially, suggesting that this should not pose a significant barrier for those who have yet to claim their distributions.
The KYC verification process necessitates two forms of identification and can be completed in approximately ten minutes, according to BlockFi. Upon completion, review, and approval of the KYC process, clients can expect their processed payments to be delivered within 45 days.
According to bankruptcy regulations, any assets that remain unclaimed by the May 15 deadline will be redistributed among other unsecured creditors, who are lower in the priority hierarchy.
