Bankrupt cryptocurrency lender BlockFi is trying to block attempts by the similarly bankrupt FTX and Three Arrows Capital (3AC) that aim to retrieve hundreds of millions of dollars to pay back their creditors.
BlockFi claimed in an Aug. 21 filing to a New Jersey bankruptcy court that its own creditors shouldn’t be pushed to the back of the line because FTX’s creditors were harmed by the exchange allegedly misappropriating $5 billion BlockFi lent it.
“FTX seeks to recover on over $5 billion of claims filed against the BlockFi estates at the direct expense of the ultimate victims of FTX’s fraud: BlockFi’s clients and other legitimate creditors.”
“To prevent further injustice to the creditors of BlockFi’s estates, the Court should disallow the FTX Claims under the doctrine of unclean hands,” BlockFi added.
FTX also provided $400 million to BlockFi in June 2022 in addition to buying BlockFi equity pursuant to a loan agreement, the filing stated.
However, BlockFi claimed it wasn’t a standard loan agreement — it was an unsecured, 5-year term that was well below market interest rates and repayments weren’t due until the firm would supposedly mature.
BlockFi referred to FTX’s investment as a “gamble” that BlockFi creditors shouldn’t be liable for.
“Just because FTX’s fraudulent actions caused FTX’s bet to fail does not mean BlockFi’s creditors are now somehow liable to refund the purchase price,” it argued.
BlockFi suggested a loan from FTX was a “gamble” that the market would stabilize. Source: Kroll
Several BlockFi creditors previously accused the firm of overlooking several red flags before transacting with FTX and its trading firm Alameda Research in the months prior to FTX’s collapse in November 2022.
Despite this, creditors settled with BlockFi last month to move forward with a repayment plan.
Donald Trump has reignited his row with London mayor Sir Sadiq Khan after calling him a “nasty person” who has done “a terrible job”.
During an hour-long news conference with Sir Keir Starmer in Scotland, the US president hit out at the Labour mayor, who has responded with his own snipey remarks.
Asked if he would visit London during his state visit in September, Mr Trump said: “I will, I’m not a fan of your mayor, I think he’s done a terrible job.
“A nasty person, I think.”
The prime minister then interrupted and said: “He’s a friend of mine.”
But the president added: “I think he’s done a terrible job but I will certainly visit London, I hope so.”
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Sir Sadiq’s spokesperson then released a statement saying: “Sadiq is delighted that President Trump wants to come to the greatest city in the world.
“He’d see how our diversity makes us stronger not weaker; richer, not poorer.
“Perhaps these are the reasons why a record number of Americans have applied for British citizenship under his presidency.”
Image: Sir Sadiq Khan was knighted in June. Pic: PA
They noted that Sir Sadiq has won three mayoral elections, including when Mr Trump lost the US election in 2020.
This is not the first time Mr Trump and Sir Sadiq have locked horns.
Sir Sadiq then described Mr Trump as a “poster boy for racists”.
And in November 2024, after Mr Trump won his second term, Sir Sadiq said many Londoners would be “fearful” about what it would “mean for democracy”.
However, as Sir Keir tried to show diplomacy with Mr Trump after becoming PM, Sir Sadiq said he “wanted to work closely with the American president” ahead of his inauguration in January.
The London mayor said as somebody “who believes in democracy, and voting and elections, we should recognise the fact that Donald Trump is the elected president of the United States”.
But he added: “Let’s keep our fingers crossed that this president is different from the last time he was president.”
The SEC delayed decisions on the Truth Social Bitcoin ETF and Grayscale’s Solana Trust, extending review periods as the US Congress moves with crypto regulation.
The US House of Representatives will be in recess for the month of August, but the Senate still has a week of business to address two crypto bills before breaking.