BlockFi Bankruptcy Administrator and DOJ Settle $35M Crypto Lawsuit
BlockFi's bankruptcy administrator and the US Department of Justice (DOJ) have settled a lawsuit regarding the transfer of over $35 million in crypto assets, which was dismissed with prejudice by Judge Michael B. Kaplan. The lawsuit, initiated in May 2023, sought to transfer funds from BlockFi accounts linked to two Estonian citizens involved in a separate criminal fraud case. The DOJ claimed jurisdiction over the assets, but the settlement stipulates that neither party can refile the case, and each will cover its own legal costs. BlockFi, which declared bankruptcy in November 2022, is in the process of winding down and has set a withdrawal deadline of April 28, 2024, for customers. The company previously reached an $875 million settlement with FTX and Alameda Research to resolve claims totaling about $1 billion. BlockFi owes approximately $10 billion to over 100,000 creditors, with significant debts to its top three creditors and Three Arrows Capital.
