{"id":16462,"date":"2023-01-24T07:04:04","date_gmt":"2023-01-24T07:04:04","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/crypto\/blockfi-to-sell-160m-in-bitcoin-miner-backed-loans-report\/"},"modified":"2023-01-24T07:04:06","modified_gmt":"2023-01-24T07:04:06","slug":"blockfi-to-sell-160m-in-bitcoin-miner-backed-loans-report","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/crypto\/blockfi-to-sell-160m-in-bitcoin-miner-backed-loans-report\/","title":{"rendered":"BlockFi to sell $160M in Bitcoin miner-backed loans: Report"},"content":{"rendered":"
<\/p>\n
Bankrupt crypto lending firm BlockFi has plans to sell off $160 million in loans backed by around 68,000 Bitcoin mining machines as part of bankruptcy proceedings, according to reports.<\/p>\n
In a Bloomberg report on Jan. 24, two people \u201cfamiliar with the matter\u201d claim that BlockFi started the process of selling off the loans last year.<\/p>\n
The crypto lender filed for Chapter 11 bankruptcy in Nov. 2022,\u00a0citing its significant exposure to the now-defunct crypto exchange FTX for its downfall.<\/p>\n
However, some of these loans have already defaulted since then and could be undercollateralized given the decline in the price of Bitcoin mining equipment, according to the sources, adding\u00a0the last day for bidders to submit offers for the loans is Jan. 24.<\/p>\n
In comments to Cointelegraph, crypto lawyer Harrison Dell, director at Australian law firm Cadena Legal explained that if Bitcoin mining equipment used as collateral is worth less than the value of the loans, the loans are \u201cnot worth their paper value anymore to BlockFi.\u201d<\/p>\n
Dell said that the people bidding for the debts are most \u201clikely\u201d to be debt collection businesses buying for \u201ccents on the dollar.\u201d<\/p>\n
He added that selling the debt is likely \u201call that the administrators\u201d for BlockFi can salvage for these assets.<\/p>\n
Dell also suggested that this is just the beginning of what\u2019s to come for the crypto industry. He noted:<\/p>\n
\u201cThis is just the start of the asset sales from BlockFi and other crypto firms in Chapter 11 bankruptcy in the US.\u201d<\/p><\/blockquote>\n
Cointelegraph reached out to BlockFi for comment but did not receive a response by the time of publication. <\/p>\n
BlockFi\u2019s attempt to liquidate its loans is likely part of efforts to pay off its creditors, which according to its bankruptcy filing in Nov. 2022, the company has over 100,000 creditors.<\/p>\n
At the time of its bankruptcy, it was reported that BlockFi sold $239 million of its own cryptocurrency assets to cover the bankruptcy expenses and warned approximately 70% of its staff that they would lose their jobs.<\/p>\n
Related:<\/em><\/strong> <\/strong>BlockFi bankruptcy filing triggers a wide range of community reactions<\/em><\/strong><\/p>\n
Earlier this week, BlockFi petitioned the court in a Jan. 23 declaration to release funds to allow bonuses for key employees in a bid to retain them amid the Chapter 11 bankruptcy proceedings.<\/p>\n
BlockFi\u2019s chief people officer Megan Crowell told the court that without financial incentives, it\u2019s unlikely the company will be able to retain its employees.<\/p>\n
Crowell said it is highly likely many staff will leave the company without competitive compensation, noting that it would add further financial impact to the company down the road.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
Bankrupt crypto lending firm BlockFi has plans to sell off $160 million in loans backed by around 68,000 Bitcoin mining machines as part of bankruptcy proceedings, according to reports. In a Bloomberg report on Jan. 24, two people \u201cfamiliar with the matter\u201d claim that BlockFi started the process of selling off the loans last year. […]<\/p>\n","protected":false},"author":1,"featured_media":16463,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","om_disable_all_campaigns":false,"footnotes":""},"categories":[42],"tags":[],"class_list":["post-16462","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto"],"yoast_head":"\n
BlockFi to sell $160M in Bitcoin miner-backed loans: Report | NFT & Crypto News<\/title>\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\t\n\n\n\n\t\n\t\n\t\n