Following BlockFi Bankruptcy Case Summary

Reorg’s First Day team continues to follow the growing number of cryptocurrency companies in distress, including FTX, Celsius and Voyager. The newest joiner to this group, BlockFi, a Jersey City, N.J.-based provider of crypto exchange services, and several affiliates filed chapter 11 petitions today reporting $1 billion to $10 billion in both assets and liabilities. In addition to its exchange offerings, BlockFi also functions as a crypto bank, offering loan services and interest-bearing accounts to retail and institutional clients.

Following the “collapse of FTX, the BlockFi management team and board of directors immediately took action to protect clients and the Company,” says Mark Renzi of Berkeley Research Group in the company’s press release issued contemporaneously with the bankruptcy filing this morning. The debtors state that they enter bankruptcy with approximately $256.5 million of unencumbered cash and anticipate that this cash “will be sufficient to fund the costs” of the chapter 11 cases, indicating that they do not intend to seek approval of DIP financing “at this time.” As detailed below, the BlockFi debtors take pains in their first day papers to distinguish their corporate governance and operating procedures from those that have come to light in the FTX cases.

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