Lawyers representing bankrupt cryptocurrency lender BlockFi Inc. said that while the company has more than $200 million in exposure to Silicon Valley Bank, the company is financially stable and has access to ample cash reserves, Bloomberg reported.
During Monday's bankruptcy hearing, Christine Okike of Kirkland & Ellis claimed that BlockFi was not in immediate danger and had sufficient funds to continue operating normally, including paying employees and suppliers.
Okike reportedly said: "BlockFi is great. we can get cash to function properly, including paying employees and suppliers." Okike also noted that BlockFi expects to acquire a significant portion of the cash held by Silicon Valley Bank later in the day. The majority of BlockFi’s exposure to SVB is through third-party money market mutual funds, which Okike claims has had no direct impact on the company’s operations. The bankruptcy case, identified as BlockFi Inc., No. 22-19361, is pending in U.S. Bankruptcy Court for the State of New Jersey in Trenton. On March 10, California financial regulators shut down Silicon Valley Bank, a large financial institution serving venture-backed companies. The closure makes it the first FDIC-insured bank to fail in 2023.
Defunct cryptocurrency lender BlockFi allocated $227 million worth of uninsured funds to money market mutual funds (MMMFs) offered by struggling Silicon Valley Bank (SVB), a bankruptcy filing on March 11 revealed.
As previously reported by Cointelegraph, global banking giant HSBC has announced the acquisition of Silicon Valley Bank UK (SVB UK), a subsidiary of the now-defunct Silicon Valley Bank, for £1 ($1.21). SVB UK had loans worth about 5.5 billion pounds ($6.7 billion) and deposits of about 6.7 billion pounds ($8.1 billion) as of March 10, according to HSBC.
