BlockFi Seeks Bankruptcy Protection, Points Out Obligations Owed By FTX

Crypto lending platform ensnared by crisis in digital currencies.

on Monday, citing obligations owed to it by former ally FTX Trading, whose collapse is wreaking havoc in the cryptocurrency-related markets.

BlockFi mentioned exposure to FTX in a statement announcing its filing, saying it would “focus on recovering all obligations owed to BlockFi by its counterparties, including FTX and associated corporate entities. Due to the recent collapse of FTX and its ensuing bankruptcy process, which remains ongoing, the company expects that recoveries from FTX will be delayed.”

BlockFi said it has $256.9 million of cash on hand to support operations while it attempts to craft a plan to “maximize value for all clients and other stakeholders.” The filing took place in the U.S. Bankruptcy Court for New Jersey under Chapter 11 of the federal Bankruptcy Code. BlockFi, which is based in Bermuda, also filed with that country’s Supreme Court for the appointment of liquidators. It said it expected client claims to be addressed in the U.S. proceedings.

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