Creditors Accuse BlockFi of Fraud and Delaying Bankruptcy Resolution
Creditors of BlockFi have filed to liquidate the company’s estate, alleging fraud, incompetence, and intentional delay of the bankruptcy resolution. They claim that BlockFi is using the delay to negotiate legal releases for its senior management. The creditors are calling for an end to what they describe as “extortion tactics” and want transparency regarding the company’s operations and CEO Zac Prince’s personal profits.
Key Points:
- Creditors accuse BlockFi of fraud, dishonesty, incompetence, or gross mismanagement.
- BlockFi is allegedly using the delay to negotiate legal releases for senior management.
- Creditors demand transparency regarding the company’s operations and CEO’s personal profits.
- Mediation has failed, and negotiations are at a standstill.
- Creditors criticize BlockFi’s high administrative costs and excessive spending.
BlockFi Updates Bankruptcy Plan
BlockFi has also updated its plan under Chapter 11 of the bankruptcy code. According to the revised disclosure statement, holders of BlockFi interest accounts could recover between 39% and 100% of their assets under the bankruptcy plan, compared to 36% and 60% via liquidation.
BlockFi has not yet provided a comment on the matter.
Hot Take:
The allegations against BlockFi raise serious concerns about the company’s integrity and its management. The creditors’ accusations of fraud and intentional delays suggest a lack of transparency and accountability. BlockFi’s response and future actions will determine whether it can regain trust and salvage its reputation in the crypto lending industry.
By
By
By
By
By