The bankrupt cryptocurrency lender BlockFi has been given permission by the court to auction off its cryptocurrency mining equipment as part of the company’s continuous attempts to repay its debtors.
BlockFi was given permission to sell its assets in an order that was issued on January 30 in the United States Bankruptcy Court for the District of New Jersey. The ruling said that selling the assets was fair, reasonable, and suitable in light of the circumstances.
The court noted that the sale of the firm’s assets is intended to maximize the amount of money that may be recovered as well as the value that the company can realize.
It is anticipated that there will be an increase in the number of offers submitted for the cryptocurrency lender’s crypto mining assets now that the court has given BlockFi the go-ahead.
The Debtors have articulated good and sufficient reasons for authorizing and approving the Bidding Procedures, which are fair, reasonable, and appropriate under the circumstances and designed to maximize the recovery.
According to the requirements outlined in the document, all eligible bids must be submitted by the deadline of February 20 to the parties mentioned in the bidding processes.
The court must receive the offers by March 2, and the representatives of the creditors have until March 16 to object to the sale of the assets to the eligible bidders.
Prospective bidders must hand deliver a written proposal to each co-counsel to the creditors before they are allowed to participate in the bidding process.
In the proposal, you need to specify not only the planned purchase price but also the particular assets that the prospective bidder is interested in purchasing and the method by which they would fund the acquisition of those assets.
The short deadline that BlockFi has set is an attempt to gather offers as fast as possible in order to capitalize on the current market circumstances, which have seen most cryptocurrencies surge after months of sideways price movement. This may be considered as an attempt to make the most of the situation.
Francis Petrie, the attorney representing the company, said in court that the business has already received interest from potential buyers for several of its assets and anticipates more of the same.
As for BlockFi’s creditors
It became public knowledge not long after the cryptocurrency lender filed its bankruptcy petition that the company owes more than one billion dollars to three of its major creditors.
This includes a settlement with the Securities and Exchange Commission (SEC) in the amount of $100 million, which took place in February of 2022.
According to the documents filed in the bankruptcy case by BlockFi, the company owes money to more than 100,000 different creditors.
The company also submitted a request to the bankruptcy court in December, requesting that it grant permission for users to withdraw their holdings.
The company described this action as a significant step toward our ultimate goal of returning assets to clients through the process of their bankruptcy proceedings.