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Cryptocurrency lender and financial services firm BlockFi filed for Chapter 11 bankruptcy Monday, following the near collapse of FTX.
The company, which listed over 100,000 creditors, 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 collapsed 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.”
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.
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Chris Morris
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