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BlockFi Files for Chapter 11 Bankruptcy Amid Financial Uncertainty

BlockFi seeks to stabilize operations by filing for Chapter 11 bankruptcy following FTX's collapse, aiming to retain key employees and manage expenses.
Published on 2022-11-28

BlockFi's Bankruptcy Filing

BlockFi, a prominent name in the cryptocurrency industry, has filed for Chapter 11 bankruptcy as of November 28. This significant move, involving the company and its eight subsidiaries, was made in the United States Bankruptcy Court for the District of New Jersey. The filing follows days of intense speculation regarding the company's financial stability, especially in the wake of FTX's recent downfall.

Financial Standing and Immediate Plans

At the time of filing, BlockFi reported having $256.9 million available. The company has taken steps to stabilize its operations, including filing motions to ensure employee wages are paid and benefits continue without disruption. Additionally, BlockFi plans to implement a Key Employee Retention Plan to maintain essential staff needed for critical business functions. This indicates a strategic effort to preserve internal expertise during this challenging period.

Expense Management and Future Steps

BlockFi has also devised an internal plan aimed at reducing expenses. This is a crucial measure to manage financial resources effectively and navigate through the bankruptcy proceedings. By focusing on cost reduction, the company aims to streamline its operations and ensure long-term sustainability.

BlockFi's actions reflect a proactive approach to managing its current financial difficulties while prioritizing the retention of vital employees and maintaining operational continuity. This development is a critical turning point for the company as it seeks to stabilize its position in the volatile cryptocurrency market.

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