BlockFi demands guarantees from FTX

The cryptocurrency lender issued a lawsuit against FTX, demanding compliance with a previous agreement

Crypto asset lender BlockFi, which has filed for bankruptcy, has filed a lawsuit against Emergent Fidelity Technologies, the investment vehicle of Sam Bankman-Fried, the founder and former CEO of platform FTX, which also filed for bankruptcy in November.

In its claim, BlockFi demands compliance with the terms of the pledge agreement, entered into between the firms on November 9, two days before FTX declared bankruptcy, and to recover the collaterals guarded by Emergent.

In this sense, it states that, under said agreement, Emergent guaranteed “absolutely, unconditionally and irrevocably” the payment obligations of the borrower using as collateral “certain common shares” whose delivery BlockFi has required Emergent in accordance with the terms of the agreement.

The lender registered this week the voluntary application to seek protection from Chapter 11 of the Bankruptcy Law during the restructuring of its activity, thus becoming the latest victim in the sector after the collapse of FTX, which declared bankruptcy on past November 11.

Specifically, BlockFi and eight of its subsidiaries have begun Chapter 11 suspension of payments proceedings before the Bankruptcy Court for the District of New Jersey in order to stabilize their business and have the opportunity to carry out a comprehensive restructuring. to maximize value for customers and other interested parties.

The platform indicated that it will focus on recovering all obligations owed by its counterparties, including FTX itself and other associated entities, although it assumes that due to its recent collapse, recoveries will be delayed.


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Source: BBC

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