Bankrupt cryptocurrency lender BlockFi has been granted court permission to return US$297 million to clients holding non-interest-bearing accounts. However, this does not include repayment to customers who made last-minute attempts to transfer funds into those accounts. It was concluded by the UK Bankruptcy Judge that customers owned their deposits in BlockFi’s Wallet programme, a non-interest-paying scheme that maintained customer deposits separately from BlockFi’s general funds. Clients with interest-bearing accounts, though, did not own their deposits, as they were provided to BlockFi to be used in their broader lending ventures.
In 2022, several cryptocurrency lenders went bankrupt, including BlockFi, prompting queries about the ownership of customer funds in similar instances, such as the liquidations of Celsius Network and Voyager Digital. In those…
