Beautiful Virgin Islands

Wednesday, Sep 03, 2025

Crypto lender BlockFi files for bankruptcy after FTX implosion

Crypto lender BlockFi files for bankruptcy after FTX implosion

BlockFi is latest company affected by FTX fallout, files Chapter 11 bankruptcy. Company's troubles go back to the spring, but the collapse of FTX was an insurmountable obstacle. The company says it has over 100,000 creditors.
The company, which listed over 100,000 creditors, had suspended withdrawals earlier this month, saying it was “not able to operate business as usual.” The liquidity issues came following the implosion of FTX, which, in June, had agreed to “rescue” BlockFi with a $400 million credit line with an option to purchase the company.

That agreement let BlockFi avoid a bankruptcy filing at the time, but when FTX fell apart earlier this month, BlockFi said it had “significant exposure” to the company and “like the rest of the world, found out about [the] situation through Twitter.”

FTX is listed as BlockFi’s second largest creditor, and BlockFi owes it $275 million. Ankura Trust, a company that represents creditors in stressed situations, is the largest creditor. That firm is owed $729 million.

“With the collapse of FTX, the BlockFi management team and board of directors immediately took action to protect clients and the Company,” said Mark Renzi of Berkeley Research Group, BlockFi’s financial advisor, in a statement. “BlockFi looks forward to a transparent process that achieves the best outcome for all clients and other stakeholders.”

While activity on the platform remains paused at present, BlockFi said it had $256.9 million in cash on hand. And while it expects to lay off a percentage of its workforce, it has asked the court for permission to pay employees without disruption, in hopes of retaining those workers who oversee business-critical functions.

A concurrent bankruptcy filing was also made by BlockFi in Bermuda, where it has a subsidiary.

BlockFi’s issues did not begin with the troubles at FTX. Critics have long warned about the company’s claim that people could obtain loans in minutes without credit checks.

In February, the Securities and Exchange Commission reached a $100 million settlement with the company’s lending arm over allegations it illegally offered an unregistered product that paid customers high interest rates to lend out their digital tokens. It was the largest ever penalty by the SEC against a crypto company.

Last year, BlockFi was valued at approximately $5 billion, but as of last week that value had tumbled to less than $500 million.  

BlockFi is the latest crypto company to file bankruptcy in an increasingly bleak crypto winter. Voyager Digital and Celsius Networks both filed Chapter 11 earlier this year.

Our new weekly Impact Report newsletter will examine how ESG news and trends are shaping the roles and responsibilities of today’s executives—and how they can best navigate those challenges. Subscribe here.
Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
Eurozone Inflation Rises to 2.1% in August
Russia and China Sign New Gas Pipeline Deal
China's Robotics Industry Fuels Export Surge
Suntory Chairman Resigns After Police Probe
Gold Price Hits New All-Time Record
Von der Leyen's Plane Hit by Suspected Russian GPS Interference in an Incident Believed to Be Caused by Russia or by Pro-Peace or by Anti-Corruption European Activists
UK Fintechs Explore Buying US Banks
Greece Suspends 5% of Schools as Birth Rate Drops
Apollo to Launch $5 Billion Sports Investment Vehicle
Bolsonaro Trial Nears Close Amid US-Brazil Tension
European Banks Push for Lower Cross-Border Barriers
Poland's Offshore Wind Sector Attracts Investors
Nvidia Reveals: Two Mystery Customers Account for About 40% of Revenue
Woody Allen: "I Would Be Happy to Direct Trump Again in a Film"
Pickles are the latest craze among Generation Z in the United States.
Deadline Day Delivers Record £125m Isak Move and Donnarumma to City
Nestlé Removes CEO Laurent Freixe Following Undisclosed Relationship with Subordinate
Giuliani Seriously Injured in Accident – Trump to Award Him the Presidential Medal of Freedom
EU is getting aggressive: Four AfD Candidates Die Unexpectedly Ahead of North Rhine-Westphalia Local Elections
Lula and Putin Hold Strategic BRICS Discussions Ahead of Trump–Putin Summit
WhatsApp is rolling out a feature that looks a lot like Telegram.
Investigations Reveal Rise in ‘Sex-for-Rent’ Listings Across Canada Exploiting Vulnerable Tenants
Chinese and Indian Leaders Pursue Amity Amid Global Shifts
European Union Plans for Ukraine Deployment
ECB Warns Against Inflation Complacency
Concerns Over North Cyprus Casino Development
Shipping Companies Look Beyond Chinese Finance
Rural Exodus Fueling European Wildfires
China Hosts Major Security Meeting
Chinese Police Successfully Recover Family's Savings from Livestream Purchases
Germany Marks a Decade Since Migrant Wave with Divisions, Success Stories, and Political Shifts
Liverpool Defeat Arsenal 1–0 with Szoboszlai Free-Kick to Stay Top of Premier League
Prince Harry and King Charles to Meet in First Reunion After 20 Months
Chinese Stock Market Rally Fueled by Domestic Investors
Israeli Airstrike in Yemen Kills Houthi Prime Minister
Ukrainian Nationalist Politician Andriy Parubiy Assassinated in Lviv
Corporate America Cuts Middle Management as Bosses Take On Triple the Workload
Parents Sue OpenAI After Teen’s Death, Alleging ChatGPT Encouraged Suicide
Amazon Faces Lawsuit Over 'Buy' Label on Digital Streaming Content
Federal Reserve Independence Questioned Amid Trump’s Push to Reshape Central Bank
British Politics Faces Tumultuous Autumn After Summer of Rebellions and Rising Farage Momentum
US Appeals Court Rules Against Most Trump-Era Tariffs
UK Sought Broad Access to Apple Users’ Data, Court Filing Reveals
UK Bank Shares Dive Over Potential Tax on Sector
Germany’s Auto Industry Sheds 51,500 Jobs in First Half of 2025 Amid Deepening Crisis
Bruce Willis Relocated Due to Advanced Dementia
×