Crypto Firm BlockFi Files for Bankruptcy

Crypto Firm BlockFi Files for Bankruptcy

Crypto firm BlockFi has filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the District of New Jersey as the FTX fallout continues to spread.

In the filing, the company indicated that it had more than 100,000 creditors, with liabilities and assets ranging from $1 billion to $10 billion. In the filing, the company listed an outstanding $275 million loan to FTX US, the American arm of Sam Bankman-Fried’s now-bankrupt empire. BlockFi’s bankruptcy filing shows that the company’s largest disclosed client has a balance of nearly $28 million.

Here’s the notice sent out to users today:

BlockFi today voluntarily filed petitions for Chapter 11 reorganization. You will be able to find the official announcement here.

This action follows the shocking events surrounding FTX and associated corporate entities (“FTX”) and the difficult but necessary decision we made as a result to pause most activities on our platform.

Since the pause, our team has explored every strategic option and alternative available to us, and has remained laser-focused on our primary objective of doing the best we can for our clients. These Chapter 11 cases will enable BlockFi to stabilize the business and provide BlockFi with the opportunity to consummate a reorganization plan that maximizes value for all stakeholders, including our valued clients.

Rest assured, we will continue to work on recovering all obligations owed to BlockFi as promptly as practicable.

Additional information regarding our Chapter 11 cases, including court documents and claim information, can be found by visiting BlockFi’s claims agent Kroll at https://restructuring.ra.kroll.com/blockfi. Clients with questions about the process may call Kroll at (888) 773-0375 (Toll Free) or (646) 440-4371 (International), or email blockfiinfo@ra.kroll.com.

We apologize that communication with our clients has not been as frequent as you have come to expect from us. We look forward to transparency through our reorganization, and will work to keep clients and stakeholders informed as we make progress. You can find additional information about our Chapter 11 process and what this means for you in our FAQ and our blog.

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