SEC delays payment of $30M fine to BlockFi

block fi
block fi

The US Securities and Exchange Commission (SEC) has postponed the payment of a fine of $30 million to BlockFi until the claims of creditors of the crypto lending platform are fully repaid.

According to the court documents, the Commission proposed to transfer the amount due to it into the category of “general unsecured claims”. The SEC waived prioritization of the fine in order to “maximize the distribution amount to investors and avoid delay.”

The agency retained all rights regarding the requirements for BlockFi. We are talking about the balance of the $50 million owed by the SEC as a result of the settlement of claims against the platform in February 2022.

In November, BlockFi filed for Chapter 11 bankruptcy. The SEC was among the company’s largest creditors. Their total number exceeded 100,000 with total claims of more than $1 billion. The platform estimated the available assets at $256.9 million.

At the time, Hodder Law founder Sasha Hodder admitted in a comment to CoinDesk that paying the fine would be a priority for BlockFi.

“Clients here are really at the bottom of the list,” she said.

In May 2023, the court allowed the company to return ~$300 million to customers held in custodial accounts.

Subsequently, management announced the planned liquidation of the platform after an unsuccessful deal to sell it.

Recall, the company hopes to resume the withdrawal of user funds before the end of the summer.

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