BlockFi Settles $35M with DOJ Amid Bankruptcy Issues

• Lyla Velez
• July 14, 2025
• News
• 0 Comments

BlockFi and the U.S. Department of Justice have agreed on a $35 million settlement as part of ongoing bankruptcy proceedings, approved by Judge Michael B. Kaplan in New Jersey.

Settlement Details

BlockFi finalized a $35 million settlement with the DOJ concerning asset seizures in the bankruptcy process. Previously, BlockFi filed for bankruptcy after FTX’s collapse, highlighting significant financial issues.

Judicial Approval

Judge Michael B. Kaplan approved the settlement, closing a chapter of legal uncertainty over asset contention. This shift enables BlockFi to prioritize repayments under Mohsin Meghji’s administration. As Judge Michael B. Kaplan stated,

The case is dismissed with prejudice… Each party will bear its own legal fees and costs as part of the settlement.

Creditor Relief

Creditors expressed relief as the settlement eliminates substantial legal bottlenecks. The resolution facilitates ongoing distributions, with the majority of U.S. customers receiving repayments earlier than expected.

Regulatory and Financial Outcomes

The DOJ’s agreement to dismiss the case reflects a resolution in regulatory disputes. BlockFi’s creditors are better positioned for the disbursement of previously contested funds. The financial implications suggest improved creditor outcomes with ongoing litigation resolved. Industry observers note reduced risk of asset volatility impacting broader markets.

Future Implications

Potential outcomes of the settlement include smoother creditor repayments and minimal market disruption. Industry patterns show preference for litigation resolutions similar to BlockFi’s approach.