FTX and Alameda have resolved their dispute with BlockFi and agreed to pay the company up to $874 million, subject to court approval.
Bankrupt crypto companies FTX and BlockFi have reportedly resolved disputes stemming from their 2022 bankruptcy, after the crypto exchanges sent numerous companies into a death spiral and left billions of dollars in limbo. It is being According to the details of the deal, FTX will pay BlockFi up to $874.5 million, pending approval by U.S. Bankruptcy Judge John Dorsey in Wilmington, Delaware, Reuters reported.
Litigation between the two companies began in 2023, with both companies seeking to recover funds lent to them before their joint bankruptcy in November 2022. Under the newly reached settlement, FTX will pay BlockFi $250 million, but the remaining amount will depend on FTX's efforts. Repaying customers in bankruptcy proceedings.
FTX also promised to pay BlockFi an additional $185.3 million, representing the amount BlockFi had in its FTX trading account at the time of the exchange's collapse. Distribution rates for his BlockFi customers with interest-bearing accounts vary widely, with recovery possibilities ranging from 39.4% to 100% of the account balance.
As part of the settlement, BlockFi agreed to drop its lawsuit over 56 million Robinhood shares that were allegedly pledged as collateral for a loan to FTX's main market maker, Alameda Research. These stocks were seized by the US Department of Justice following the arrest of FTX founder Sam Bankman Fried. He was convicted on multiple charges related to the exchange's collapse and currently faces more than 100 years in prison.
