What Happened to BlockFi? The Collapse and the Payouts

The short version: BlockFi is gone, and it has been for a while. It filed for bankruptcy on November 28, 2022, switched the lights off for good on May 31, 2024, and did eventually pay customers back in full. That last part comes with a catch that matters a great deal, and we will get to it.

Most people reading this are in one of two situations. Either you had money with BlockFi, and you are still wondering how that ended, or you clicked an old review and had no idea the company had shut down. Either way, here is the whole story.

How BlockFi Fell Apart

BlockFi launched in 2017 with a genuinely appealing pitch: park your crypto with us and earn up to 9.5% interest on it. Plenty of people did. For a few years it was one of the biggest names in the business, and it added crypto-backed loans and a Bitcoin rewards credit card — that we highly reviewed — on top.

The first crack showed in February 2022, when the SEC and 32 state regulators hit BlockFi with a $100 million settlement, half to the SEC and half split among the states. The finding was that those interest accounts were unregistered securities, and that BlockFi had misstated how risky its loan book actually was. Worth pausing on that second part. The company had been telling people its lending was safer than it was.

Then the dominoes. In mid-2022, Three Arrows Capital, one of BlockFi’s largest institutional borrowers, collapsed owing money it could not repay. BlockFi needed a lifeline, and FTX gave it one: a credit line reported at up to $400 million, along with an option for FTX to buy the company outright.

You know how this goes. FTX imploded in November 2022, taking the lifeline with it. BlockFi froze customer withdrawals on November 10 and filed for Chapter 11 on November 28, listing more than 100,000 creditors.

One correction while we are here, because it circulates constantly: FTX never bought BlockFi. It had an option to and never exercised it, which is why BlockFi ended up filing its own separate bankruptcy.

So the whole thing came down to this. BlockFi lent customer deposits to institutional borrowers, one of those borrowers went under, and the emergency backstop it reached for went under even faster.

Did Customers Get Their Money Back?

Yes, but read the next few paragraphs before you celebrate or despair, because the headline and the reality are two different things.

The court confirmed BlockFi’s plan in October 2023, and the first distributions started going out in early 2024. Then came the windfall. BlockFi’s estate held a large claim against the FTX estate, settled at $874.5 million, and rather than wait years for FTX’s own bankruptcy to grind through, the plan administrator sold that claim to a third party at a hefty premium. In July 2024, the administrator announced the result: 100% recovery on allowed customer claims.

Here’s the catch: That 100% is measured against the dollarized petition-date value of your claim, meaning what it was worth on the day BlockFi filed in November 2022. Bitcoin was trading near $16,000 that week, close to the bottom of the cycle.

So if you had 1 bitcoin sitting in a BlockFi account when everything froze, you were made whole on roughly $16,000. You did not get the bitcoin back. Whatever that coin is worth as you read this, the gap between those two numbers is the part nobody puts in a headline.

Granted, it still compares well to the other big failures of that era. Voyager customers were looking at an initial recovery around 36%, and Celsius eventually distributed about 93% of eligible claim value. Recovery figures in these cases shift across distribution rounds, so treat them as snapshots rather than final scores. And it is worth being clear about why BlockFi’s number landed where it did: a one-time litigation windfall, not careful stewardship. The customer assets were not kept safe. That is what the bankruptcy was about.

If You Still Have Not Claimed

Some people never collected. As of April 2025, about 97% of US customers had claimed their distributions, but only about 43% of non-US customers had. There was an identity-verification deadline in May 2025, after which unclaimed money gets redistributed to other creditors rather than waiting around for you.

We are deliberately not printing an exact deadline date, because news coverage at the time gave conflicting ones, and this is not a detail to be approximately right about. Go to the source instead. blockfi.com is now the official wind-down notice page, and it links through to the claims portal run by Kroll, the restructuring administrator. Check your own status there.

Not through a search result. Not through an email. Which brings us to the next bit.

The Scams Are Real, and They Are Targeting You Specifically

If you were a BlockFi customer, you are on a list somewhere, and people know exactly what you are hoping to hear.

Security researchers at Kaspersky documented phishing campaigns built specifically around this bankruptcy: emails dressed up in BlockFi branding, inviting you to claim a payment you are owed, leading to fake pages that ask you to connect your wallet or type in your seed phrase. blockfi.com carries its own standing phishing warning, which tells you the administrators still consider this live.

Three rules to keep you safe, and they hold no matter how convincing the email looks:

Nobody legitimate will ever ask for your seed phrase or private key. Not the administrator, not Kroll, not a support agent, nobody. There is no situation where handing those over is the right move.
Any service charging you an upfront fee to “recover” your BlockFi funds is a scam. The real process does not cost money.
And type blockfi.com into your browser yourself rather than clicking through from an email or a search result. That one thing will defeat most of these attacks.

What About the BlockFi Rewards Visa Card?

Unfortunately, this offer died with the bankruptcy filing in November 2022. Purchases stopped working, and applications closed. If you have found a site offering to pre-approve you for one, it has nothing to do with the real product, because it no longer exists.

If you are a former cardholder wondering about rewards you had already earned, we have to be honest: we could not confirm from primary sources exactly how accrued card rewards were handled in the bankruptcy. We are not going to guess at it. The claims portal linked from blockfi.com is the place to ask.

Was BlockFi Ever Legitimate?

Yes, BlockFi was a real venture-backed company with real offices and real employees. It was not FTX. Nobody was secretly moving customer money into a hedge fund. But in retrospect, it was not clean, either.

The SEC penalized it in 2022 for selling unregistered securities and for misstating its loan-book risk, and in November 2024, California’s regulator permanently revoked BlockFi’s lending license over how it originated loans: not checking whether borrowers could repay, charging interest before money was disbursed, and inaccurately disclosing APRs.

The actual failure came down to one structural choice. BlockFi lent out customer deposits, and when a big borrower went down, it did not have the assets to absorb the hit. That is worth sitting with, because the lesson is not that crypto lending is inherently a scam. The lesson is that what your lender does with your collateral while it holds it is the entire question.

We prefer the ones that can show you they do not re-lend it, rather than the ones that simply say so.

For the record, this site covered BlockFi favorably before the collapse, which is a direct reason we now weigh custody and transparency above headline rates.

Where People Went Instead

The crypto lending business that survived 2022 is smaller and, on the whole, considerably more open about where your collateral actually sits.

Nexo returned to the US market in 2026 and publishes information about where deposited assets are held.
Ledn keeps collateral with qualified custodians, never re-lends it, and backs that up with monthly proof-of-reserves you can actually check.
Coinbase runs its loans on-chain through Morpho, so the terms are verifiable by anyone rather than promised by a company.
Strike offers fixed-rate loans with no origination fee and a fee structure you can read in one sitting.

Our crypto loan comparison page has the current rates, minimums, and custody arrangements for each of them side by side.

Questions People Still Ask

Is BlockFi coming back?

No sign of it. There has been no brand relaunch or sale of the business as of September 2026. Co-founder Zac Prince has moved on to run Galaxy Digital’s retail arm, but that is a career move, not a revival.

Can I still get a BlockFi loan or credit card?

No. The platform closed permanently on May 31, 2024, and the credit card stopped working back in November 2022. Anything you find today offering either one is not connected to a real BlockFi product.

How do I claim my distribution?

Type blockfi.com into your browser. It is the official wind-down page and links through to the Kroll claims portal, where you can check your own status. Do not get there via an email or a search result.

Did I get my actual crypto back?

No. Everyone was repaid in dollars, based on what their claim was worth on the November 2022 filing date, not in the coins they deposited and not at today’s prices.