BlockFi was a digital asset lender founded by
Zac Prince and Flori Marquez in 2017. It was based in
. It was once valued at $3 billion.
In July 2022, it was announced that the cryptocurrency exchange
FTX
FTX Trading Ltd., trading as FTX (Futures Exchange), is a bankrupt company that formerly operated a cryptocurrency exchange and crypto hedge fund. The exchange was founded in 2019 by Sam Bankman-Fried and Gary Wang and collapsed in 2022 after ...
made a deal with an option to buy BlockFi for up to $240 million. The deal included a $400 million credit facility for the company.
In November 2022, after the declaration of
bankruptcy by FTX, the company halted withdrawals on its platform. The firm disclosed "significant exposure" to FTX on November 14. The next day,
the ''Wall Street Journal'' reported that BlockFi would likely file for bankruptcy, which was reaffirmed by reports compiled by
Bloomberg News
Bloomberg News (originally Bloomberg Business News) is an international news agency headquartered in New York City and a division of Bloomberg L.P. Content produced by Bloomberg News is disseminated through Bloomberg Terminals, Bloomberg T ...
. On November 28, BlockFi confirmed the reports and officially filed for
Chapter 11 bankruptcy protection
Chapter 11 of the United States Bankruptcy Code (Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, wh ...
with more than 100,000 creditors, according to filings. In March 2023, following the
collapse of Silicon Valley Bank
On March 10, 2023, Silicon Valley Bank (SVB) failed after a bank run, marking the third-largest bank failure in United States history and the largest since the 2008 financial crisis. It was one of three bank failures, along with Silvergate ...
, the
U.S. Trustee watchdog overseeing BlockFi's bankruptcy revealed that BlockFi had around $227 million in uninsured funds at the bank. BlockFi's CEO Zac Prince testified in the trial of
Sam Bankman-Fried
Samuel Benjamin Bankman-Fried (born March 5, 1992), commonly known as SBF, is an American entrepreneur who was convicted of fraud and related crimes in November 2023. Bankman-Fried founded the FTX cryptocurrency exchange and was celebrated as a ...
, and stated that he thought BlockFi would not have gone bankrupt if it had not lost access to its funds in the FTX collapse. In October 2023, BlockFi emerged from Chapter 11 bankruptcy and announced that it would begin winding down all of its remaining operations and assets post-bankruptcy. Over the next few months, crypto assets will be returned to customers at BlockFi until all assets are fully liquidated. BlockFi will continue to pursue payments from the bankruptcies of FTX and
Three Arrows Capital during the liquidation process.
References
External links
*
Crypto CasinosCrypto Casino Wolfbet
2017 establishments in New Jersey
Companies based in Jersey City, New Jersey
Cryptocurrency companies
Companies that filed for Chapter 11 bankruptcy in 2022
{{US-online-company-stub