BlockFi is filing for bankruptcy protection after being impacted by the collapse of FTX. This bankruptcy filing will allow BlockFi to restructure and get back on its feet
BlockFi Inc., who was founded in 2017, said a bankruptcy protection will provide the company with time to stabilize. BlockFi acknowledges the restructuring will include an attempt to recover all debts owed by its counterparties, including FTX and associated corporate entities. BlockFi, which was bailed out by businessperson Sam Bankman-Fried’s company FTX last summer, said it anticipates
A recent bankruptcy filing shows that BlockFi has over 100,000 creditors and its liabilities range from $1 billion to $10 billion.
Blockfi’s mission is to provide crypto investors with liquidity when they need it most – when they are experiencing an unexpected loss of capital or when they want to take a risk without the fear of losing all their money. The platform offers a variety of products and services including margin trading, futures contracts and options on Bitcoin (BTC).
There have been a few other crypto-lending companies that chose to declare bankruptcy this year. Bitcoin reached its lowest point for the year after the economic crash which caused Celsius Network and Voyager Digital to file for bankruptcy.
BlockFi currently has $256.9 million in liquid cash, which should allow the company to last for a while during the restructuring process.
Cryptocurrency advocates say that this deal with the SEC supports their claim that regulation has led to companies going offshore into places where the rules are looser. That puts consumers at risk.
