Crypto lender and liquidity provider BlockFills filed for Chapter 11 bankruptcy. The filing follows an earlier suspension of client deposits and withdrawals.
The Chicago-based firm called the voluntary filing “the most responsible path forward” to preserve business value and maximize recoveries for stakeholders.
From Withdrawal Freeze to Bankruptcy
In a recent statement, the firm disclosed that certain BlockFills-related entities filed to restructure under Chapter 11 of the US Bankruptcy Code in the US Bankruptcy Court for the District of Delaware.
The firm pledged to continue engaging with clients, creditors, investors, and other stakeholders throughout the restructuring. It also stated that protecting client interests remains a priority.
“The BlockFills team has worked diligently to pursue and evaluate all available strategic and financial alternatives and believes initiating a chapter 11 process, with the intention of consummating a consensual restructuring with our clients and creditors, will provide the necessary time and structure to stabilize the business, pursue additional sources of liquidity and recovery, and explore potential strategic transactions,” the statement read.
BlockFills suspended client deposits and withdrawals in February, citing market and financial conditions. The platform told clients it was halting transactions to protect both the firm and its users.
The company disclosed roughly $75 million in losses tied to its lending, crypto mining, and trading operations. BeInCrypto reported that Nicholas Hammer, the firm’s co-founder and CEO, also stepped down in February 2026. Joseph Perry was appointed interim CEO.
BlockFills had engaged consulting firm BRG and law firm Katten Muchin Rosenman to advise on restructuring. Mark Renzi was brought in as chief transformation officer. Notably, Dominion Capital’s legal action intensified the pressure.
On February 27, Dominion filed a complaint alleging that BlockFills co-mingled customer funds and misused assets for crypto mining and unsecured loans. A federal judge granted a temporary restraining order on March 3.
The ruling barred BlockFills from transferring roughly 70.6 Bitcoin (BTC) allegedly belonging to Dominion and ordered the firm to account for and segregate all customer holdings.
The bankruptcy filing adds BlockFills to a growing list of crypto lenders that have collapsed under market pressures.
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