- BlockFi and 3AC reached a confidential settlement resolving dueling bankruptcy claims between the collapsed crypto entities.
- BlockFi filed for bankruptcy in 2022 amidst crypto market turmoil, while 3AC collapsed after failing to meet margin calls.
- The settlement ends a dispute in which BlockFi claimed 3AC owed $129 million and 3AC claimed BlockFi owed $280 million, but keeps terms private despite calls for transparency.
Crypto lending company BlockFi and hedge fund Three Arrows Capital (3AC) have reached a settlement related to their bankruptcy cases. The specific terms remain confidential despite calls for more transparency. The agreement resolves dueling claims between the collapsed entities.
Background on BlockFi Bankruptcy
BlockFi filed for Chapter 11 bankruptcy protection in November 2022, amidst financial troubles exacerbated by ties to crypto exchange FTX. BlockFi’s restructuring plan was approved in September 2023, allowing creditor repayments to begin the next month.
Background on 3AC Bankruptcy
3AC collapsed during the 2022 crypto market crash. The fund filed for bankruptcy after failing to meet margin calls from lending institutions like BlockFi. 3AC’s founders face legal issues including a $1 billion asset freeze.
Details of BlockFi and 3AC Settlement
BlockFi claimed 3AC owed them $129 million, while 3AC argued BlockFi owed $280 million. The settlement approved by a New Jersey bankruptcy court resolves these counterclaims. However, the specific terms remain confidential despite the US Trustee’s calls for transparency. The judge ruled that keeping the details private makes sense to avoid impacting related legal proceedings.
Conclusion
The BlockFi and 3AC settlement ends a dispute between two major crypto casualties but leaves questions about the terms. It exemplifies the complex legal fallout from the 2022 crypto crash as companies navigate bankruptcy. The crypto sector continues to deal with this financial turmoil through settlements, restructurings and other means.
