On Wednesday, the deadline for the cryptocurrency platform BlockFi Inc. to file its Chapter 11 or reorganization plan has been extended to the mid of the following month by a bankruptcy judge in the state of New Jersey. The judge stated that it was worth a brief delay to guarantee that the case continues to operate seamlessly.
BlockFi’s Deadline Set For May 15
At the hearing, BlockFi counsel Joshua Sussberg reportedly referred to it as a “modest” extension and stated that the firm would have a plan prepared for evaluation by the unsecured creditors within two weeks’ time.
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As stated by Law360’s report on the ruling, U.S. Bankruptcy Judge Michael B. Kaplan pointed out that the plan will be confronted with “unusual” legal and regulatory difficulties; and that he wished to prevent “wasted dollars and efforts” dealing with various plan applications.
While delivering his ruling on the matter, Judge Kaplan was quoted as saying:
The estate does not benefit necessarily from competing plans. I want this process to go forward with all eyes wide open.
Dire Attempt Of Quashing Bankruptcy
The committee had earlier claimed in its argument that there was no feasible reorganizational plan and that there was no need to keep the firm in bankruptcy. During the course of the hearing, the committee asserted that an evidentiary hearing was needed to evaluate if BlockFi had a solid basis to be granted an extension. In response, Judge Kaplan pointed out that it was superfluous and may lead to weeks of bickering over the extension and other plans.
BlockFi filed for bankruptcy in November last year following FTX’s colossal debacle which led to a gruesome bloodbath in the crypto market. BlockFi’s initial request for filing its Chapter 11 plan was for a 90-day extension, but due to strong objections faced by its unsecured creditors, the once-famous crypto trading platform submitted a new motion asking for the deadline to be pushed back to May.
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