In July 2022, it was announced that the cryptocurrency exchange
FTX made a deal with an option to buy BlockFi for up to $240 million. The deal included a $400 million credit facility for the company.[5][6]
In November 2022, after the declaration of
bankruptcy by FTX, the company halted withdrawals on its platform.[7] The firm disclosed "significant exposure" to FTX on November 14. The next day,
the Wall Street Journal reported that BlockFi would likely file for bankruptcy, which was reaffirmed by reports compiled by
Bloomberg News.[8][9][10] On November 28, BlockFi confirmed the reports and officially filed for
Chapter 11 bankruptcy protection[11] with more than 100,000 creditors, according to filings.[12][13] In March 2023, following the
collapse of Silicon Valley Bank, the
U.S. Trustee watchdog overseeing BlockFi's bankruptcy revealed that BlockFi had around $227 million in uninsured funds at the bank.[14] BlockFi's CEO Zac Prince testified in the trial of
Sam Bankman-Fried, and stated that he thought BlockFi would not have gone bankrupt if it had not lost access to its funds in the FTX collapse.[15] In October 2023, BlockFi emerged from Chapter 11 bankruptcy and announced that it would begin winding down all of its remaining operations and assets post-bankruptcy. Over the next few months, crypto assets will be returned to customers at BlockFi until all assets are fully liquidated. BlockFi will continue to pursue payments from the bankruptcies of FTX and Three Arrows Capital during the liquidation process.[16]