Coinbase Partners with BlockFi (BFI) Ahead of Imminent Platform Shutdown: A New Chapter in Crypto Exchange

• BlockFi, the now-bankrupt digital asset lender, has announced adopting Coinbase as a distribution partner.
• Working with Coinbase will ensure the continuity of crypto withdrawals available to eligible BlockFi Interest Accounts (BIA), Retail Loans, and Private Clients.
• The BlockFi platform will shut down in May 2024 after initial distributions.

BlockFi, a bankrupt digital asset lender, partners with Coinbase to ensure the continuity of crypto withdrawals for its clients. The platform is set to shut down in May 2024.

BlockFi Adopts Coinbase as Distribution Partner

BlockFi, a formerly prominent digital asset lender now in bankruptcy, has announced a new partnership with Coinbase. This move is aimed at ensuring the continuity of crypto withdrawals for eligible BlockFi Interest Accounts (BIA), Retail Loans, and Private Clients. The partnership will utilize account emails on file to communicate with clients about further details, including instructions on creating accounts on Coinbase.

Implications for BlockFi Users

For crypto-eligible clients who missed the April 28 withdrawal deadline, this partnership provides a lifeline, allowing them to access their funds. However, BlockFi has clarified that users who fail to create Coinbase accounts as instructed may have their funds liquidated and distributed to them in cash, according to the Plan. Furthermore, BlockFi has warned its clients to be vigilant of scam attempts from third-party bad actors, emphasizing that users should not patronize any other provider for crypto distributions on its behalf.

Future Distributions and BlockFi’s Shutdown

In the event of future distributions, such as funds recovered from FTX, the bankrupt crypto exchange, Coinbase will remain the viable option for the Plan Administrator. In 2022, FTX entered a deal with BlockFi to buy the digital asset lender for $240 million and agreed to provide BlockFi with a $400 million revolving credit facility. Outside of distributing funds recovered from FTX, the Plan Administrator will only be able to make distributions in cash for those unable to register on Coinbase.

Conclusion

BlockFi has announced that it will shut down in May 2024, although a specific date has not been provided due to ongoing work and initial distributions. After the shutdown, clients will become unable to access the BlockFi platform. This development underscores the importance of vigilance and due diligence in the rapidly evolving crypto market.