FTX reached an $874.5 million settlement with BlockFi
According to a March 6 court filing, BlockFi and FTX have reached an “in-principle” agreement to resolve their dispute. Accordingly, FTX agreed to pay BlockFi a total of $874.5 million and BlockFi will waive lawsuits against the exchange. The deal is subject to approval by U.S. Bankruptcy Judge John Dorsey in Delaware.
This includes compensation for the value of BlockFi customers' assets and loans Alameda Research received from BlockFi. Part of the total amount is considered a “secured claim”, with priority paid to BlockFi after FTX emerges from bankruptcy, the remaining part will depend on the ability to repay related parties in advance.
BlockFi's bankruptcy administrators said the outcome was achieved through “early settlement,” which cuts litigation costs and ensures “litigation funds will be used to pay customers.”
On November 28, 2022, BlockFi filed for Chapter 11 bankruptcy protection, citing the collapse of FTX earlier that month. The two companies then sued each other in 2023.
BlockFi said FTX owes them more than $1 billion, coming from a $400 million credit line and nearly $900 million loaned to Alameda Research. That loan was almost exclusively collateralized by FTX's FTT tokens, which fell nearly 99% due to FTX's collapse.
