FTX Is The Cause Of BlockFi’s Bankruptcy, Court Filings Show

“BlockFi has worked to positively shape the cryptocurrency industry and advance the sector,” but the crypto lender’s failure was caused by Sam Bankman-Fried’s own empire, according to court filings.

The information is provided in a press statement by Mark Renzi, Managing Director of Berkeley Research Group, which serves as a financial advisor to BlockFi and has been hired to look into bankruptcy proceedings.

Renzi highlights two significant factors for BlockFi‘s current situation: the collapse of FTX and the falling global crypto market.

He mentions the SEC settlement of $30 million. He believes that, despite the fact that 2022 was a difficult year for the crypto industry, a comeback will occur in the future year. Renzi further claims that FTX’s action in May-June of this year exacerbated BlockFi’s situation.

On November 28, the cryptocurrency startup BlockFi filed for Chapter 11 bankruptcy protection in the United States. Following the failure of its well-known purchaser FTX.

A pending $275 million loan to FTX was noted in the filing. According to the filing, the company has over 100,000 creditors, with liabilities and assets ranging from $1 billion to $10 billion.

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