BlockFills Files for Chapter 11 Bankruptcy After Halting Customer Withdrawals

Crypto lending platform BlockFills has filed for Chapter 11 bankruptcy protection in the United States after suspending customer deposits and withdrawals last month. The filing was submitted in a Delaware bankruptcy court by its operating company, Reliz LTD, along with three affiliated entities as part of a restructuring effort.

Court documents estimate the firm’s assets at between $50 million and $100 million, while liabilities are believed to range from $100 million to $500 million. The company said the restructuring process is intended to stabilize operations, secure additional liquidity, and explore potential strategic options that could preserve value for stakeholders.

Liquidity Pressure Followed Market Downturn

BlockFills had restricted customer activity earlier, halting deposits and withdrawals as it worked to address liquidity challenges during a broader downturn in digital asset markets. During that period, Bitcoin dropped sharply from above $97,000 in mid-January to below $64,000 in early February, intensifying pressure across the crypto lending sector.

Legal Dispute and Asset Freeze

The bankruptcy filing follows a legal dispute with Dominion Capital, which accused the lender of misusing customer funds and commingling assets. A US court earlier ordered the temporary freeze of 70.6 bitcoin connected to the platform while requiring a full accounting of customer balances.

Disclaimer

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