Crypto News– Bankrupt crypto lender BlockFi and collapsed crypto hedge fund Three Arrows Capital (3AC) have reached a settlement in court, but the specific terms of the agreement have been kept confidential.
A Sealed Agreement Between BlockFi and 3AC Gets the Nod from U.S. Judge
During a hearing on February 6th in a New Jersey Bankruptcy Court, Judge Michael Kaplan approved the settlement between the two entities. Initially, BlockFi asserted that 3AC owed the firm $129 million, whereas 3AC claimed that BlockFi owed them $280 million.
The dispute revolved around preferential payments, which are transactions conducted just before bankruptcy that might have provided the recipient with a larger sum than they would have received through court proceedings.
The resolution of the counterclaims between BlockFi and 3AC follows mediation ordered by Judge Kaplan last October and likely stems from a two-day hearing commencing on January 5th to conclusively address the matter.
“It’s counterintuitive to require the disclosure of settlement details,” remarked the Judge, dismissing a request from the U.S. Trustee to reveal the specifics.
In its motion to seal the information, BlockFi cited certain commercially sensitive aspects of the agreement that could potentially affect its future legal proceedings. The firm’s Chapter 11 reorganization plan was approved by the court in September last year, with BlockFi expressing readiness to initiate creditor repayments by October.
BlockFi has begun allowing withdrawals for customers with funds held in BlockFi Wallet accounts in phased batches, completing the first wave of distributions on January 22nd. The company stated that it had returned over $500 million worth of crypto to 130,000 of its clients.
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