BlockFi becomes another victim of the FTX collpase with bankruptcy filing

With BlockFi being the next company to file for bankruptcy, FTX’s recession is gradually spreading to more cryptocurrency companies.

block phi Said On November 28, it filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of New Jersey, seeking to recover all obligations owed to BlockFi by counterparties, including FTX.

BlockFi said, “We expect the recovery from FTX to be delayed due to the recent FTX bankruptcy and ensuing bankruptcy process.”

Additionally, BlockFi reports that it has $256.9 million in cash on hand, which should provide ample liquidity during the “restructuring.”

at the time of recent bankruptcy filings According to BlockFi CEO Zachary Prince, BlockFi has over 100,000 creditors, $1 billion to $10 billion in liabilities, and $1 billion to $10 billion in assets.

While activity on the platform remains suspended, the company said it aims to stabilize the business with its bankruptcy filing and complete a restructuring transaction that maximizes value for all clients and other stakeholders. said.

block phi

Over 100,000 creditors
$1 billion to $10 billion of debt
$1 billion to $10 billion in assetshttps://t.co/3hBTUHfyQ0 pic.twitter.com/FkEHo056iz

Decibel (@tier10k) November 28, 2022

The filing also revealed that the Securities and Exchange Commission (SEC) was one of the $30 million creditors.according to saucethe crypto lender has also laid off a significant portion of its staff.

BlockFi on the verge of bankruptcy over the past few weeks

BlockFi suspended customer withdrawals on Nov. 11 as crypto lenders faced difficulties after the collapse of popular crypto exchange FTX.

Before that, BlockFi COO Flori Marquez informed investors that all deposit, withdrawal, trading and lending protocols are active.

However, Crypto announced on November 14 that it has substantial exposure to FTX. At the time, BlockFi made sure it had enough liquidity to explore all options and enlisted outside advisors such as Haynes and Boone to help with its next move.