Summer

Billion

Elon Musk

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 <p>BlockFi is trying to block attempts by FTX and Three Arrows Capital to recover billions of dollars worth of repayments from the lending firm.</p> 
 <p>In two notices of objection filed by BlockFi on Monday, the firm cited fraud committed by both companies as the reason behind its current financial predicament, which it argued makes them in<a rel="noopener noreferrer nofollow" title="eligible" href="https://thebittimes.com/tag/eligible.html">eligible</a> for repayments.</p> 
 <p>“FTX’s fraud caused BlockFi to lose over a billion dollars worth of property, which could take years of litigation to recover,” it said in a notice. “FTX’s fraud was also a primary cause of BlockFi’s bankruptcy.”</p> 
 <p>The notice adds that despite all the ”wrongful acts—FTX filed defective claims against the BlockFi estates, each of which is meritless.”</p> 
 <p>In another notice entitled Objection to Claims of Three Arrows Capital, BlockFi claimed that the now-defunct crypto hedge fund company used fraudulent measures to borrow money from the lender and is thus not entitled to repayment.</p> 
 <p>The notice states, “3AC borrowed money from BlockFi through 3AC’s fraud, and some of 3AC’s debt to BlockFi was paid back when 3AC failed to respond to a margin call and BlockFi foreclosed on posted Collateral. 3AC owes BlockFi for this deficiency. BlockFi owes 3AC nothing.”</p> 
 <p>BlockFi has also stated that its current legal woes with FTX, Three Arrows Capital, and other crypto firms could affect the $1 billion it has promised to repay its customers.</p> 
 <h2 id="blockfi-owes-over-10-billion-to-its-creditors">BlockFi Owes Over $10 Billion to Its Creditors</h2> 
 <p>Cointelegraph reported that the now-defunct crypto lending company owes $10 billion to over 100,000 creditors. It owes $1 Billion to three of its largest creditors and $220 million to Three Arrows capital, it said.</p> 
 <p>This news comes amidst the revelation made by another court filing by the Unsecured Creditors Committee. It highlighted a report from BlockFi’s risk management team that stated Zach Price, the CEO of BlockFi, ignored concerns about BlockFi lending $217 million to FTX affiliate Alameda Research in August 2021.</p> 
 <p>According to the reports, the team had warned BlockFi of the eminent risks if the FTX token is used to secure the loans.</p> 
 <p>These creditors proceeded to settle with BlockFi last month to stay on the path of the repayment plan.</p> 
 <p>BlockFi had filed for Chapter 11 Bankruptcy protection on November 28, shortly after FTX did the same.</p> 
 <h2 id="blockfi-opens-withdrawals-of-digital-assets">BlockFi opens Withdrawals of Digital Assets</h2> 
 <p>On August 17, BlockFi made a decision to open withdrawals of digital assets from BlockFi accounts for <a rel="noopener noreferrer nofollow" title="eligible" href="https://thebittimes.com/tag/eligible.html">eligible</a> clients.</p> 
 <blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
  <p lang="en" dir="ltr">Earlier today, we opened withdrawals of digital assets from BlockFi Wallet accounts for <a rel="noopener noreferrer nofollow" title="eligible" href="https://thebittimes.com/tag/eligible.html">eligible</a> clients in accordance with the authorization provided by the Court in the Wallet Order: https://t.co/wOc3Fk0VpH</p> 
  <p>— BlockFi (@BlockFi) August 17, 2023</p> 
 </blockquote> 
 <p></p> 
 <p>“This is an important step forward toward our goal of returning funds to clients,” it said in a tweet. “Through this process, our top priority is making distributions as quickly, efficiently, accurately, and safely as possible.”</p> 
 <h3 id="related">Related</h3> 
 <ul> 
  <li>BlockFi Alerts Customer Withdrawals Could Kick off this Summer</li> 
  <li>FTX Founder Bankman-Fried Seeks Court Relief Amid Legal Quagmire</li> 
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BlockFi Says FTX and Three Arrows Capital Ineligible for Repayment

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