Key Highlights:
- BlockFi claimants have until May 15 to recover their assets, as stated in their announcement.
- To date, 97% of U.S. clients have claimed their distributions, whereas only 43% of international clients have made claims.
Less than half of the non-U.S. customers of the bankrupt cryptocurrency lender BlockFi have stepped forward to retrieve their assets, with the upcoming May 15 deadline creating urgency, as per a recent update from the firm.
BlockFi filed for bankruptcy in November 2022 due to the fallout from the collapse of FTX impacting the crypto sector. Following its bankruptcy, the company announced a plan to disburse 100% of the dollar value of customer claims from when it filed for bankruptcy, which was confirmed in a statement made in July 2024.
A concerning factor is that while U.S. claimants have had a more streamlined process to retrieve their assets, international customers face additional complexity due to legal considerations in both the U.S. and Bermuda, leading to a significant disparity in claim rates.
A hypothesis regarding the low engagement from non-U.S. customers is that communication from BlockFi regarding payment processes might be misconstrued as spam or phishing attempts. The company is combating this by collaborating with security professionals to ensure the legitimacy of their outreach efforts.
“BlockFi is doing everything possible to facilitate final distributions to all former clients,” stated the company’s announcement. “A subset of clients may need to complete a ‘Know Your Customer’ verification process to access their distributions. We strongly urge clients yet to receive their distributions or finalize this process to do so before May 15, 2025.”
Indeed, both U.S. and non-U.S. clients had already completed KYC before they were permitted to use BlockFi’s services, so this notion should not hinder remaining claimants.
The verification, which only takes about ten minutes with two forms of identification, must be completed for payments to be issued, which the company claims will be processed within 45 days of approval. Following the May 15 deadline, any unclaimed assets will be allocated to other unsecured creditors as per bankruptcy law.
