11-29-2022 icon

BlockFi declares bankruptcy, cites FTX debacle 

By Lucy Adegbe

BlockFi declared openly, on November 28,  that it had signed up for a volitional suit under chapter 11 of the United States insolvency code. The filing, which is pertinent to the firm alongside its eight subdivisions, follows the queries concerning the firm’s monetary fitness since FTX failed.

As reported by BusinessWire, BlockFi still holds about $256.9 million. It signed up for moves to settle its workforce salaries and carry on with staff benefits without interruption. Additionally, it aims to introduce a major workers retention strategy for the assuredness that the protocol will hold on to well-coached internal aids for the organization’s integral operations and has put in place, an internal strategy to minimize expenditures. 

BlockFi International was also reported to have signed up for insolvency protection at the high court of Bermuda.

FTX US signed out a $400 million loan in the last days of June, which caused concerns that BlockFi’s exposure was likely to yield a liquidity challenge. 

BlockFi made moves to suspend outgoing payment transactions on November 11, with a recent website update explaining that the team has been sourcing effective options and that the chapter 11 filings would help BlockFi with restructuring and stabilization.

BlockFi had received a $100 million penalty from the Securities and Exchange Commission, on February 14th, for refusal to record ample profit invoices that the regulatory body tagged as securities.