- BlockFi asks the court to allow customers to withdraw their crypto assets because the company has "no legal or equitable interest."
- BlockFi requests to delete unprocessed withdrawal petitions after the suspension on November 12.
- Former FTX CEO Sam Bankman-Fried agrees to his extradition to the US to make thighs right with customers.
BlockFi is seeking approval from a United States court to allow customers to withdraw funds locked on the platform since November 10. Monday's court filing indicates that the funds legally belong to customers and the company does not have "legal or equitable interest." BlockFi's request occurred barely a day before FTX's former CEO Sam Bankman-Fried agreed to be extradited to the United States.
BlockFi intends to honor customer withdrawals
The motion filed with the US Bankruptcy Court in the District of New Jersey cited BlockFi's "Wallet Terms of Service," stating that crypto assets "held in your BlockFi Wallet shall at all times remain with you and shall not transfer to BlockFi."
WOW, @BlockFi has already filed a motion requesting client withdrawals for assets held in BlockFi Wallet Accounts. S/O to BlockFi for moving exponentially more quickly than @CelsiusNetwork in Ch 11. pic.twitter.com/JvtWzMklNA
— Tiffany Fong (@TiffanyFong_) December 20, 2022
BlockFi stressed that debtors do not have any "legal or equitable interest in cryptocurrency that was present in the wallet accounts of the platform." The company added in the filing that "clients should be able to withdraw such assets from the platform if they choose."
The matter is currently in court and has been scheduled for a hearing on January 9. There will be a second hearing on January 13 dedicated to wallet accounts in the custody of BlockFi International, a subsidiary that handled non-US operations domiciled in Bermuda.
FTX's Bankman-Fried nods to United States extradition
Sam Bankman-Fried (SBF), the founder and former CEO of FTX, has accepted his extradition to the United States, where he is expected to face money laundering and fraud charges. SBF has been in the custody of Bahamian authorities since his arrest early last week.
Despite the nod to his extraction, it has yet to be discovered when Sam Bankman-Fried will depart the Bahamas for the US. The court did not set a further date on the matter.
Still, on FTX, the team overseeing the firm's bankruptcy proceedings is working around the clock to recover millions of Dollars in donations made by SBF to politicians.
The team, led by John Ray III, says that some politicians and other recipients of FTX's funds are reaching out for directions on how to return the funds.
It has been reported before that Sam Bankman-Fried made up to $46.5 million in political donations in the months leading to the liquidity crisis at FTX. Currently, the bankrupt exchange is working with the recipients for a voluntary return of these contributions. However, it will soon start legal action through the bankruptcy court to ensure all funds are returned.
FTX filed for bankruptcy on November 12 after the exchange had a liquidity crisis due to overwhelming withdrawal requests. An article published by CoinDesk on November 2 revealed that Alameda Research, FTX's trading arm, owned a significant amount in FTT, a token issued by the exchange.
The article triggered cascading events with Binance announcing its intent to liquidate FTT holdings. FTX was forced to file for bankruptcy after Binance pulled out of a deal to acquire the company as a way of protecting customers. The collapse of FTX continues to weigh down the crypto market, with centralized exchanges like Binance coming into the spotlight on how they handle customer deposits.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Ripple wipes out weekly gains, experts comment on role of Ripple stablecoin
Ripple declined to $0.52 on Thursday, erasing all gains registered earlier this week. Ripple SVP Eric van Miltenburg’s comments on the firm’s stablecoin, and how it is expected to benefit the XRP Ledger and native token XRP have raised concerns among crypto experts.
Hedera HBAR slips nearly 10% after air is cleared on mistaken link with giant BlackRock
HBAR price is down nearly 10% on Thursday, partly erasing gains inspired by the misinterpreted link with BlackRock. Despite the recent correction, Hedera’s price is up 44% in the past seven days.
The reason behind Bonk’s 105% rise and if you should buy now Premium
Bonk price has shot up 105% in the past five weeks. A retracement into $0.0000216 or the $0.0000152 to $0.0000186 imbalance would be a good buying opportunity. Patient investors can expect double-digit gains from BONK that could extend up to 70%.
Injective price weakness persists despite over 5.9 million INJ tokens burned
Injective price is trading with a bearish bias, stuck in the lower section of the market range. The bearish outlook abounds despite the network's deflationary efforts to pump the price. Coupled with broader market gloom, INJ token’s doomed days may not be over yet.
Bitcoin: BTC post-halving rally could be partially priced in Premium
Bitcoin (BTC) price briefly slipped below the $60,000 level for the last three days, attracting buyers in this area as the fourth BTC halving is due in a few hours. Is the halving priced in for Bitcoin? Or will the pioneer crypto note more gains in the coming days?