BlockFi’s Staff Retention Program Has Been Approved by the Judge

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Last Updated on January 28, 2023 by Bitfinsider

A New Jersey bankruptcy court judge has granted BlockFi’s request to pay bonuses to senior employees.

“It allows the debtor and the employee to move on and optimize the estate,” Judge Michael Kaplan remarked at a hearing on Friday. “I’m delighted to approve it moving forward.”

The bankrupt crypto lender has stated that it is losing staff in a “battle for talent” to corporations such as Walmart, Google, and Block Inc. Eleven employees have departed BlockFi since the company filed for bankruptcy in November, according to lawyer Rush Howell, accounting for roughly 10% of the company’s remaining employment.

“This was a wonderful combination for possible attrition, and unfortunately, the debtors saw that attrition,” Howell said. “It is crucial that the debtors implement these retention initiatives in order to keep critical employees with the firm.”

According to the retention scheme submitted in court, the BlockFi debtors are authorized to adopt a program that would provide staff incentives of 42.5% or 9% of their base wage, depending on their job. The program might cost up to ten million dollars.

BlockFi attorneys also recognized a redaction “snafu” that occurred earlier this week during the hearing. Unredacted financial records were accidentally published by lawyers. The fresh statistics caused media outlets to suggest that BlockFi had a $1.2 billion exposure to bankrupt cryptocurrency exchange FTX – $200 million more than was previously reported.

“What occurred here was entirely an error,” said attorney Joshua Sussberg. “I want to be clear: there are no such things as hidden financials.”

Sussberg stated in court records that BlockFi’s statistics fluctuated because one figure indicated a loan from Alameda Research, which utilized FTX’s native utility token as security, down to zero.

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