NEW: Bankrupt crypto exchange BlockFi admitted on Tuesday that it has $355 million stuck in FTX_Official, on top of a $671 million loan to Alameda Research that the quant trading firm defaulted on. nikhileshde and cheyenneligon report
Crypto lender BlockFi has about $355 million in cryptocurrencies currently frozen on crypto exchange FTX, attorney Joshua Sussberg told a U.S. bankruptcy court on Tuesday.
BlockFi filed for bankruptcy protection in the U.S. Bankruptcy Court for the District of New Jersey on Monday after weeks of speculation about the company’s solvency after it paused withdrawals earlier in November.
“We intend, Your Honor, as we noted in the pleadings, to quickly file a motion to allow customers to withdraw from their personal wallet to the extent they so wish, because we do not believe that is property of the estate,” he said.Sussberg told Judge Michael Kaplan that he anticipates the process of recovering BlockFi’s funds from FTX will “play out over a long period of time.
Sussberg referenced current FTX CEO John Jay Ray III’s statement that he had never seen “such a complete failure” of FTX’s executive leadership in his career – which included cleaning up after Enron’s collapse.
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