According to a January 27 filing, New Jersey Bankruptcy Court Judge Michael Kaplan approved payments to crypto lender BlockFi Operations of up to $10 million in a “retention plan.”
Court Filing BlockFi showed it could pay its employees $9.98 million in three installments over a 12-month period. The insolvent company allowance is divided into two tiers: the first pays employees 42.5% of their basic salary, and the other pays 9% of their basic salary.
Meanwhile, the court filing did not specify the number of employees eligible for the bonus or the eligibility for the two tiers. Media reports put the number of employees at the company at 130.
Why a Bankrupt Company Wants to Pay Its Employee Bonuses
A previously bankrupt crypto lender argued It should pay bonuses to its employees to retain their services throughout the bankruptcy proceedings.
According to BlockFi’s Chief People Officer Megan Crowell, there was a raging war for talent, and its employees “have many opportunities both inside and outside of the cryptocurrency industry.”
However, BlockFi’s unsecured lenders argued that the proposed bonus was “broader and more expensive than other crypto events.”
Separately, bankrupt crypto firms like Celsius and Voyager also filed a claim Retention programs For their employees. Both companies argued that the fee would help them retain the services of scarce talent available to their employees.
Other updates from BlockFi’s bankruptcy
Latest financial documents available revealed BlockFi disclosed $1.2 billion for bankrupt crypto firms FTX and Alameda Research. Bankruptcy debtor filings showed $415.9 million in assets at FTX and $831.3 million in debts to Alameda. In addition, the company had 662,427 users, and more than 70% had balances of less than $1,000.
Additionally, Bloomberg reported On January 23 the lender plans to sell $160 million in loans collateralized by 68,000 mining machines. The lender’s business along with other miners was hit hard BitcoinA record low decline in 2022.
Also, the lender statement To Sam Bankman-Fried Robinhood shares Before it was seized by US authorities. According to the lender, the shares were pledged against the loan to Alameda.
BeInCrypto has reached out to the company or person involved in the story to get an official statement on the latest developments, but has yet to hear back.