The crypto bankrupt BlockFi received a court approval to sell off its crypto-mining equipment to repay creditors. The firm is expected to conduct the auction asap, while the market faces upheaval
The failed crypto lender BlockFi got a favourable approval decision from the United States Bankruptcy Court for the District of New Jersey on Jan. 30. The company is allowed to sell out its crypto mining equipment and related assets to maximize the fund recovery for its numerous creditors.
The court acknowledged the sale was “fair, reasonable and appropriate under the circumstances.” The company insisted on the quickest bidding process possible, as the current crypto market growth would allow the bankrupt lender to acquire more funds during the sale.
Therefore, “all qualified bids” must be sent to the parties specified in the bidding procedures by the Feb. 20 deadline and filed to the court by Mar. 2. Meanwhile, the creditor’s representatives can legally object to the asset sale until Mar. 16.
To participate in the bidding process, potential bidders must present a “written proposal” with the details of the purchase price bid. Additionally, they must specify which assets they are interested in acquiring and how they will finance the purchase.
BlockFi’s lawyer, Francis Petrie, told the court the company has already witnessed interest in the bidding process, received unofficial proposals from bidders for various assets and expects more to come now in a written form.
BlockFi has filed for Chapter 11 bankruptcy restructuring, deeply affected by the recent FTX collapse, in November 2022. This January, the bankrupt lender started selling off $160 million in loans backed by approximately 68,000 Bitcoin mining machines as part of bankruptcy proceedings. Some loans BlockFi has to manage have already defaulted under the crypto market decline.