BlockFi Allegedly Used Customers’ Funds for $30M Insurance Purchase, Creditors Allege

Creditors of cryptocurrency lending firm BlockFi, which filed for bankruptcy after the collapse of FTX in late 2022, have filed a new court document in response to the company’s latest restructuring plan. The company had outlined its Chapter 11 reorganization plan on May 12, stating that a sale of the business would not generate enough value for creditors, who are owed almost $1.3 billion. The creditors have now accused BlockFi of deliberately delaying the trial, arguing that the firm sold around $240 million of cryptocurrency in November 2022, following the crypto market slump caused by FTX’s failure. The creditors claim that the decision has cost them over $100 million since, due to unnecessary tax consequences. They are calling for the case to be ended as quickly as possible and for the assets to be placed in the hands of new management. BlockFi has not yet responded to the matter.

J-S Tremblay
About the author - J-S Tremblay

I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...

View J-S Tremblay website

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top