BlockFi, a globally popular crypto lender, has recently received the green signal from a bankruptcy court in New Jersey to sell off their self-mining rigs worth approximately $4.5 million to U.S. Farms & Mining Opportunity Fund LLC. The rigs may be sold “free and clear of any liens, claims, interests, and encumbrances.”
This sale is anticipated to help aid BlockFi in recovering from its financial troubles, as the company had previously filed for Chapter 11 bankruptcy in the last week of November 2022 after losing millions of dollars. The company stated that FTX’s collapse is the main reason for filing for bankruptcy.
Several cryptocurrency companies have faced severe financial difficulties after the bankruptcy of FTX. Over a dozen companies have lost their funds, and three have filed for bankruptcy, including BlockFi, which was the first to follow the FTX bankruptcy path. This development has stirred the crypto market globally.
Furthermore, according to financial market data, Silvergate Capital Corp stock has lost over 85% of its share price over the past month. This company held multiple accounts of FTX and Alameda Research, which are currently being probed by the U.S. Department of Justice (DoJ) fraud unit for their close involvement in the case.
Although the bank claimed that Alameda had opened an account with them in 2018, sometime before the FTX launch, it supposedly performed due diligence and ongoing monitoring at the time. A bank representative stated that the firm “has a comprehensive compliance and risk management program.”
In the midst of all these financial troubles, BlockFi has invested in 12 different companies and startups and has led investment in another firm. The lending firm has invested in Supermojo, Elwood technologies, GamersGains Lab, Coin Metric, Hex trust, Notabene, Blockdaemon, and Jeeves.
The sale of mining rigs worth $4.5 million may not be the first cash infusion that BlockFi has received. At the beginning of March 2023, the bankruptcy court ordered Silvergate to release $9.9 million to the crypto lender.
This approval to sell off self-mining rigs may further help BlockFi rebound financially. According to the order, the sale shall be “free and clear of any liens, claims, interests, and encumbrances.”
While the crypto market has faced significant hurdles, several companies are slowly but surely gaining ground in this arena. BlockFi is one such company that has managed to cement its position in the industry and has invested in various startups to keep up with the market trends.
In conclusion, BlockFi’s approval to sell off mining rigs worth $4.5 million may prove to be a major stepping stone in the company’s efforts to recover financially. It remains to be seen how the company will maneuver around the market challenges and emerge a strong player in the industry. Nonetheless, this development highlights the ever-evolving nature of the cryptocurrency industry and the need for companies to stay on top of their game.
