Business

Crypto Firm BlockFi Files For Bankruptcy In Wake Of FTX Collapse

Photo by JUSTIN TALLIS/AFP via Getty Images

James Lynch Contributor
Font Size:

Crypto firm BlockFi filed for Chapter 11 bankruptcy protection in a New Jersey bankruptcy court following the collapse of crypto giant FTX, CNBC reported Monday.

The company indicated in its filing that it has over 100,000 creditors with a range of $1 billion to $10 billion in liabilities and assets, according to CNBC. BlockFi also reportedly listed a $275 million loan to FTX US, the American branch of former crypto billionaire Sam Bankman-Fried’s fallen empire.

Bankman-Fried’s crypto exchange FTX filed for bankruptcy after it collapsed following a report by crypto site CoinDesk about the company allegedly transferring customer funds to backstop affiliated crypto trading firm Alameda Research. BlockFi previously disclosed “significant exposure” to FTX and associated entities, Reuters reported.

The company had a deal with FTX for BlockFi to be purchased at a maximum price of $240 million if FTX exercised the option, CNBC reported in July. BlockFi had set up a $400 million revolving credit facility with FTX after it suffered $80 million in losses, according to the outlet.

BlockFi was last valued at $4.8 billion, CNBC reported, citing financial database PitchBook. The company offered customers a crypto trading exchange and crypto-backed loans, among other products, according to its website. Before filing for bankruptcy, BlockFi had halted withdrawals of customer deposits, according to Decrypt.

BlockFi owes $30 million to the Securities and Exchange Commission (SEC), the firm’s fourth-largest creditor, Bloomberg reported. The regulator charged BlockFi $100 million for not registering the offers and sales of its crypto lending product, the SEC announced in a February press release. (RELATED: Goldman Sachs Issues Stock Market Warning)

“BlockFi looks forward to a transparent process that achieves the best outcome for all clients and other stakeholders,” the company’s financial adviser, Mark Renzi of Berkeley Research Group, said in a press release Monday. The company will “focus on recovering all obligations owed to BlockFi by its counterparties, including FTX and associated corporate entities,” and anticipates recoveries from FTX will be delayed because of the latter’s collapse.

The company assured clients in a separate blog post it is “laser-focused on our primary objective of doing the best we can for our clients.” BlockFi will “work to keep clients and stakeholders informed as we make progress” on the bankruptcy proceedings.

BlockFi did not immediately respond to the Daily Caller’s request for comment.

PREMIUM ARTICLE: Subscribe To Keep Reading

Sign up

By subscribing you agree to our Terms of Use

You're signed up!

Sign up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!

Sign up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!

Sign Up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!
BENEFITS READERS PASS PATRIOTS FOUNDERS
Daily and Breaking Newsletters
Daily Caller Shows
Ad Free Experience
Exclusive Articles
Custom Newsletters
Editor Daily Rundown
Behind The Scenes Coverage
Award Winning Documentaries
Patriot War Room
Patriot Live Chat
Exclusive Events
Gold Membership Card
Tucker Mug

What does Founders Club include?

Tucker Mug and Membership Card
Founders

Readers,

Instead of sucking up to the political and corporate powers that dominate America, The Daily Caller is fighting for you — our readers. We humbly ask you to consider joining us in this fight.

Now that millions of readers are rejecting the increasingly biased and even corrupt corporate media and joining us daily, there are powerful forces lined up to stop us: the old guard of the news media hopes to marginalize us; the big corporate ad agencies want to deprive us of revenue and put us out of business; senators threaten to have our reporters arrested for asking simple questions; the big tech platforms want to limit our ability to communicate with you; and the political party establishments feel threatened by our independence.

We don't complain -- we can't stand complainers -- but we do call it how we see it. We have a fight on our hands, and it's intense. We need your help to smash through the big tech, big media and big government blockade.

We're the insurgent outsiders for a reason: our deep-dive investigations hold the powerful to account. Our original videos undermine their narratives on a daily basis. Even our insistence on having fun infuriates them -- because we won’t bend the knee to political correctness.

One reason we stand apart is because we are not afraid to say we love America. We love her with every fiber of our being, and we think she's worth saving from today’s craziness.

Help us save her.

A second reason we stand out is the sheer number of honest responsible reporters we have helped train. We have trained so many solid reporters that they now hold prominent positions at publications across the political spectrum. Hear a rare reasonable voice at a place like CNN? There’s a good chance they were trained at Daily Caller. Same goes for the numerous Daily Caller alumni dominating the news coverage at outlets such as Fox News, Newsmax, Daily Wire and many others.

Simply put, America needs solid reporters fighting to tell the truth or we will never have honest elections or a fair system. We are working tirelessly to make that happen and we are making a difference.

Since 2010, The Daily Caller has grown immensely. We're in the halls of Congress. We're in the Oval Office. And we're in up to 20 million homes every single month. That's 20 million Americans like you who are impossible to ignore.

We can overcome the forces lined up against all of us. This is an important mission but we can’t do it unless you — the everyday Americans forgotten by the establishment — have our back.

Please consider becoming a Daily Caller Patriot today, and help us keep doing work that holds politicians, corporations and other leaders accountable. Help us thumb our noses at political correctness. Help us train a new generation of news reporters who will actually tell the truth. And help us remind Americans everywhere that there are millions of us who remain clear-eyed about our country's greatness.

In return for membership, Daily Caller Patriots will be able to read The Daily Caller without any of the ads that we have long used to support our mission. We know the ads drive you crazy. They drive us crazy too. But we need revenue to keep the fight going. If you join us, we will cut out the ads for you and put every Lincoln-headed cent we earn into amplifying our voice, training even more solid reporters, and giving you the ad-free experience and lightning fast website you deserve.

Patriots will also be eligible for Patriots Only content, newsletters, chats and live events with our reporters and editors. It's simple: welcome us into your lives, and we'll welcome you into ours.

We can save America together.

Become a Daily Caller Patriot today.

Signature

Neil Patel