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Crypto Lender BlockFi Filing for Bankruptcy

Mon, 11/28/2022 - 15:31
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Alex Dovbnya
Cryptocurrency lender BlockFi is latest domino to fall during ongoing cryptocurrency crisis
Crypto Lender BlockFi Filing for Bankruptcy
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Popular cryptocurrency lender BlockFi has filed for Chapter 11 bankruptcy protection, according to a Monday announcement, with the ongoing crypto crisis claiming yet another victim.

The lending platform is paused for the time being.

The company says that it has $256.9 million in cash on hand. It will be used for providing sufficient liquidity to support some operations.

According to the company's court documents, it has up to $10 billion in estimated assets and liabilities.

BlockFi has now joined Three Arrows Capital (3AC), Voyager, Celsius and FTX on the list of companies that are in the middle of bankruptcy proceedings.

Earlier this year, it was adversely affected by the fall of Terra's Luna. FTX.US reached an acquisition deal with the embattled lender in July, agreeing to buy the company for up to $240 million while providing it with a $400 million line of credit.

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The company halted withdrawals earlier this month following the implosion of the FTX exchange and its U.S. subsidiary.

On Nov. 15, the Wall Street Journal reported that BlockFi was preparing to file for bankruptcy and fire a significant portion of its staff.

The failed cryptocurrency lender sought a whopping $5 billion valuation just a year ago.

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.