BlockFi has to update wallet, platform before distributing funds

Bankrupt lending platform BlockFi said in a June 12 email that it must perform updates before it begins to distribute funds to users.

Upgrades coming in summer

BlockFi said that a June 9 court order determined that users own the assets in their wallet accounts and that the company can allow certain withdrawals.

However, the company also said that it needs to perform updates before allowing withdrawals. Specifically, it said that it must upgrade its UI to take into account transactions and assets at the time of its service pause in November 2022.

BlockFi also said that it must add “new product functionality” to its platform but did not state what these features will include.

BlockFi said it is necessary to perform these updates to conduct withdrawals “accurately and safely.” It said that the upgrades would be completed over the summer and said that it would be positioned to begin distributing funds after that point.

The June 9 court order explicitly allows for such upgrades.

External wallets required

BlockFi said that it intends to support crypto — not cash — withdrawals. It additionally said that groups of users would be able to perform withdrawals in turns and advised users to set up external addresses for withdrawals as they wait for the process to begin.

BlockFi’s bankruptcy case has been ongoing since November 2022. The company owes between $1 billion and $10 billion to its creditors.

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