{"id":80950,"date":"2023-06-29T13:10:33","date_gmt":"2023-06-29T10:10:33","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=80950"},"modified":"2025-09-11T20:02:43","modified_gmt":"2025-09-11T17:02:43","slug":"blockfi-creditors-urge-liquidation-of-the-company","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/blockfi-creditors-urge-liquidation-of-the-company\/","title":{"rendered":"BlockFi creditors urge liquidation of the company"},"content":{"rendered":"

The creditors\u2019 committee of BlockFi, a cryptocurrency lending platform, accused its management of delaying the restructuring process and proposed to the court<\/a> that the company be liquidated.<\/p>\n

In November 2022 the firm filed for bankruptcy<\/a> under Chapter 11 of the U.S. Bankruptcy Code<\/a>. This occurred roughly two weeks after the collapse of FTX<\/a> and Alameda Research. Prior to this, BlockFi acknowledged that the exchange and its subsidiary had outstanding obligations to the company.<\/p>\n

Creditors contend that the platform\u2019s top management, including CEO Zak Prince, should be held legally responsible for providing these loans. To avoid liability, the BlockFi leadership continues to delay the restructuring, they contend.<\/p>\n

According to the complaint, the process is accompanied by an unwarranted burn of the debtor\u2019s funds. Monthly administrative expenses run at about $16 million, including salaries for around 100 employees.<\/p>\n

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\u201cMany of them, as far as we know, did little, but polished their golf games. The Official Committee repeatedly asked the debtors to cut costs. All such requests were rejected, as were other forms of cooperation,\u201d the lawsuit states.<\/p>\n<\/blockquote>\n

As of the end of May, BlockFi had spent a total of $94 million on administrative and other expenses.<\/p>\n

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\u201cUnsecured creditors are long overdue to learn what BlockFi really was, who Zak Prince really is, how he personally profited from the company, and what he and some of his colleagues actually did, contrary to their promises to clients,\u201d the petitioners said.<\/p>\n<\/blockquote>\n

They say the time for negotiations with the team is over\u2014only court proceedings lie ahead.<\/p>\n

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\u201cThis case of \u2018reorganization\u2019 is over. The business has ceased all operations and is non-functioning. Efforts to sell the platform generated zero viable offers,\u201d the creditors say.<\/p>\n<\/blockquote>\n

In their view, the court could end this \u201cextortion\u201d with one of three solutions:<\/p>\n