BlockFi Settles $35M DOJ Lawsuit, Clearing Path for Creditor Repayments

BlockFi's bankruptcy administrator has resolved a $35 million dispute with the US Department of Justice over crypto asset seizures. New Jersey Bankruptcy Court Judge Michael B. Kaplan approved the settlement, dismissing the case with prejudice and eliminating future claims on the disputed funds.

The resolution allows BlockFi to focus on repaying creditors, with 90% of US customers already claiming distributions as of April 2025. International repayments lag at 43%, with a May 15, 2025 deadline set for remaining claims.

This settlement establishes important judicial boundaries for crypto asset seizures while enabling BlockFi's estate to proceed without legal obstacles. Both parties will bear their own legal costs, marking a pragmatic conclusion to the 2023 case involving Estonian-linked accounts.