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BlockFi creditors appeal court to redact their information
U.S. authorities argued that granting BlockFi's request to redact their information could set an unfavorable precedent for other crypto industry Chapter 11 cases.
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Updated: Jan. 11, 2023 at 2:03 pm UTC
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BlockFi creditors want the court to redact their personal information, according to a Jan. 10 court filing.
The creditors argued that the redaction of their information would protect them from “hacking, identity theft, and harassment” risks in the crypto space.
According to the filing, BlockFi would lose its potential clients’ trust if this information becomes publicly available. They added that this would make it less attractive for sale, new equity investment, or restructuring transactions.
The BlockFi creditors cited the severe consequences Celsius account holders suffered because their information was released to the public. They further argued that such information would expose the customers to theft and online hacking.
According to BlockFi creditors, if an experienced Bitcoin core developer could lose over 200 BTC to a hack, retailers with much lesser experience are at significantly greater risk if they are targeted for theft.
US authorities object motion
Meanwhile, a separate filing by the U.S. Trustee objected to BlockFi’s motion to redact its client’s information.
According to the court document, the authorities do not object to the redaction of addresses and e-mails of BlockFi’s customers. However, it opposes the redaction of their names and the redaction of information of BlockFi’s institutional clients.
The U.S. authorities argued that “disclosure is a basic premise of bankruptcy law” because it eliminates “any suggestion of iimpropriety that might or could be raised.”
The authorities added that granting BlockFi’s request could set an unfavorable precedent for other Chapter 11 bankruptcy cases in the crypto industry.
Judge Michael Kaplan is slated to hear the case on Jan. 17.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
BlockFi
BlockFi is a defunct cryptocurrency lender company which is currently in bankruptcy proceedings.
Celsius Network
Celsius Network is a bankrupt cryptocurrency lending company that was founded in 2017 and headquartered in Hoboken, New Jersey.