The price of consensual hallucination. Filing also lists $30 million SEC settlement, and huge amounts owed to unnamed “clients.”
By Wolf Richter for WOLF STREET.
And it happens again. Crypto outfit BlockFi Inc., which was founded in 2017, and eight affiliates – BlockFi Trading, BlockFi Lending, BlockFi Wallet, BlockFi Ventures, BlockFi International Ltd., BlockFi Investment Products, BlockFi Services Inc., and BlockFi Lending II – filed for Chapter 11 bankruptcy today in the US Bankruptcy Court for the District of New Jersey. BlockFi International Ltd., which is incorporated in Bermuda, filed for bankruptcy with the Supreme Court of Bermuda.
BlockFi had halted withdrawals when FTX collapsed, and at the time hired bankruptcy counsel. Any fiat and cryptos anyone had on these platforms is now part of the bankruptcy proceedings.
In the bankruptcy filing, BlockFi Inc. checked the box that said it has “more than 100,000” creditors, and it checked the box that said it owed those creditors between $1 billion and $10 billion.
On its blog, BlockFi said today that withdrawals will remain blocked, and “clients’ claims will be addressed through the chapter 11 process.” Whatever amounts, if any, clients will be able to get back will be determined by the bankruptcy court.
10 largest unsecured creditors listed in the bankruptcy filing:
- Ankura Trust Company (which represents creditors in distressed situations): $729 million
- FTX US: $275 million
- Unnamed…
