BlockFi to Shut Down Web Platform, Partners with Coinbase for Fund Distribution

Cryptocurrency lender BlockFi announced on May 9 that, following the shutdown of its web platform, the company has partnered with Coinbase as a fund distribution partner.

BlockFi is pleased to announce Coinbase as our distribution partner to ensure continuity of crypto withdrawals available to our eligible BlockFi Interest Account (BIA), Retail Loan, and Private clients.

— BlockFi (@BlockFi) May 9, 2024

According to an official statement published by the company, this partnership will ensure continuity of crypto withdrawals available to all eligible BlockFi Interest Account (BIA), retail loans, and private clients.

The BlockFi web platform will shut down this month, with the specific date still under consideration and to be communicated separately over the next few weeks. However, after this date, clients will no longer be able to access the web platform.

The first round of eligible estate funds using the BlockFi platform can no longer be requested for withdrawal, it added.

BlockFi explained that clients eligible for cryptocurrency who did not remove their digital assets from the BlockFi platform by April 28, 2024, at 11:59 PM UTC or who did not finish an identity verification request by May 10, 2024, at 11:59 UTC will not have their assets converted to cash immediately; instead, they will receive funds in kind, which they can withdraw if they open or have an approved Coinbase account.

Furthermore, according to the plan, clients who are eligible for crypto payout but did not withdraw from BlockFi's platform by the deadline or open an approved Coinbase account may receive their in-kind distribution liquidated to cash and given to them in cash.

For distributions based on money recovered from FTX and other rounds of distributions in the future, the plan administrator will be able to use Coinbase. In the absence of this ability, the plan administrator would only be permitted to make cash distributions for subsequent distributions under the terms of the plan.

The announcement of BlockFi's web platform shutdown comes after FTX disclosed its revised repayment schedule. BlockFi is listed in the plan as a key stakeholder, with a $250 million payment pledged to the crypto lender.

BlockFi suffered greatly as a result of the aftermath of the November 2022 collapse of FTX, which finally caused the company to file for bankruptcy in October 2023 and start paying consumers.

In a public statement, BlockFi CEO Zac Prince blamed FTX founder Sam Bankman-Fried, who was found guilty of massive fraud and received a 25-year prison sentence, for the company's downfall.

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