BlockFi files for Chapter 11 bankruptcy protection

According to the press release, BlockFi and eight subsidiary entities filed the corresponding petition in the United States Bankruptcy Court for the District of New Jersey.

“As part of restructuring efforts, the company will focus on recovering all obligations owed to BlockFi by its counterparties, including FTX,” the statement said.

The Bermuda-registered BlockFi International Ltd. has filed a petition with the High Court to appoint provisional liquidators.

“To ensure a smooth transition to Chapter 11, BlockFi is filing a number of ordinary first-day motions that will allow the company to continue operating. These first-day motions include requests to pay employees’ salaries and continue benefits without disruption,” the platform’s representatives noted.

BlockFi intends to develop a plan to retain key staff to ensure resources are preserved to perform critical functions.

“The company also today initiated an internal plan to significantly reduce expenses, including payroll costs,” added BlockFi.

According to the platform, it has $256.9 million in liquidity, which will “provide sufficient liquidity to support certain operations in the course of restructuring.”

November 28, 2022 | 19:20Update:

According to BlockFi’s petition, it has more than 100,000 creditors. The assets and liabilities of the company are estimated to be in the range of $1 billion to $10 billion.

The major creditors include Ankura Trust Company, LLC (unsecured obligations of about $729 million), West Realm Shires Inc. ($275 million) and the U.S. Securities and Exchange Commission ($30 million). The names of the others are not disclosed.