BlockFi Bankruptcy Administrator and DOJ Reach Agreement to Drop $35M Lawsuit

The bankruptcy administrator for BlockFi and the U.S. Department of Justice (DOJ) have reached an agreement to dismiss a $35 million lawsuit. The lawsuit concerned allegations that BlockFi made unauthorized transfers to the DOJ prior to filing for bankruptcy. Under the terms of the agreement, the lawsuit will be dropped, and BlockFi will not pay any funds to the DOJ. This resolution marks a positive development in the BlockFi bankruptcy case, as it removes a costly and time-consuming dispute. The agreement comes on the heels of a series of recent developments in the bankruptcy case, including a proposed reorganization plan aimed at repaying some funds to creditors. Experts anticipate that the potential dismissal of the lawsuit could facilitate the reorganization process and potentially increase the amount of funds available for repayment to creditors. The case remains under review by the court, but the agreement between BlockFi and the DOJ represents a significant step forward.