BlockFi wins court’s approval to auction BTC mining assets

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Bankrupt digital asset lender BlockFi has won the approval of a U.S. bankruptcy court to sell its BTC block reward mining assets.

BlockFi’s lawyers argued in court that this is the ideal time to auction off the company’s BTC mining assets as the sector is seeing a slight turn in fortunes after a rough year in 2022. In the video court hearing, the lawyers, led by Francis Petrie, claimed that the company had received bids for the assets from various interested parties.

“We’ve received substantial interest in the market for bidding purposes and current volatility in the cryptocurrency market, which means we need to act quickly,” Petrie told U.S. Bankruptcy Judge Michael Kaplan.

BlockFi was one of the key financiers for the block reward mining industry during the bull rally that saw every other digital asset set new highs. The miners put up their mining rigs as collateral, and since most miners were blown out of the water by the 2022 bear market, they could not meet their debt obligations. The defunct lender is now seeking to auction off these assets to leverage a recent uptick in BTC’s price.

Interested parties must submit their bids by February 20, with the auction set to be held a week later. The lender will return to court in early March to seek the judge’s approval for any proposals made during the auction.

Petrie told the court that any assets that failed to attract an acceptable bid would be restructured as part of the company’s proposal to exit the bankruptcy proceedings.

“I think it’s a workable and certainly an expeditious and efficient process that’s contemplated. We’ll all keep our fingers crossed that it produces significant results,” Judge Kaplan noted in his ruling that followed the withdrawal of the government’s objections to the proposal.

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Ethereum, FTX and Tether—who have co-opted the digital asset revolution and turned the industry into a minefield for naïve (and even experienced) players in the market.