Crypto Trading Firm BlockFills Files for Bankruptcy Following Liquidity Crunch

Illinois-based crypto trading company BlockFills has filed for bankruptcy after facing liquidity challenges following the crypto market crash in early February, the company said in a March 15 statement.

“On March 15, 2026, certain BlockFills-related entities filed a voluntary petition to restructure under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware,” the company said.

BlockFills offered spot and derivatives trading in digital assets and provided cryptocurrency borrowing and lending services.

According to a voluntary petition filed at the court, BlockFills, which also goes by Reliz LTD, has an estimated $50 million to $100 million in assets and between $100 million and $500 million in liabilities. The company owes money to 1,000–5,000 creditors. Voluntary bankruptcy petitions were filed by three other related entities as well.

In a March 15 filing with the court, Mark Renzi, the chief restructuring officer at BlockFills, said a crypto market crash had created mounting liquidity pressures on the company and triggered a wave of customer requests to withdraw funds, forcing the business to temporarily suspend certain deposit and withdrawal activity on Feb. 2.

If these withdrawal requests had been honored, it would have “impaired BlockFills’ ability to continue operations,” according to the filing. On Feb. 6, the company publicly announced a broader temporary suspension of deposits and withdrawals.

Renzi highlighted a “significant crash” of bitcoin around early February, dropping below $80,000 for the first time since April 2025. In the few days before Feb. 2, there was a rapid fall in the values of popular cryptocurrencies. After opening at about $89,261 on Jan. 29, bitcoin fell by nearly 12 percent by the end of Feb. 2. Ethereum declined by more than 22 percent during this period.

The company considered various alternatives to stabilize the business before eventually deciding to file under Chapter 11, Renzi said. Restructuring should provide enough time to stabilize it and pursue additional liquidity sources, the company said. It employs 11–50 people.

Cryptocurrency Decline

Cryptocurrencies have struggled for months since a record crash in October 2025 sent bitcoin tumbling from a peak as leveraged positions got washed out. That left investors less keen on digital assets, and sentiment toward the industry was fragile.

“We believe this broader decline is mainly driven by massive withdrawals from institutional [exchange-traded funds]. These funds have seen billions of dollars flow out each month since the October 2025 downturn,” Deutsche Bank analysts said in a note to clients.

U.S. spot bitcoin exchange-traded funds had outflows of more than $3 billion in January, following outflows of about $2 billion in December and $7 billion in November, the note said.

“This steady selling in our view signals that traditional investors are losing interest, and overall pessimism about crypto is growing,” the analysts wrote.

On Feb. 2, another crypto company, Texas-based NFN8 Group, which was engaged in cryptocurrency mining and digital asset creation, filed for bankruptcy. The company employed 11–50 people.

The company had faced a host of problems over the past years, according to a Feb. 2 filing at the court.

For many years, the company’s business model “functioned successfully,” according to the filing.

“NFN8 Holdings made lease payments as required, and the Debtors consistently reinvested into their mining infrastructure,” it reads.

“Ultimately, however, a convergence of extraordinary events—market dislocation following the April 2024 Bitcoin halving, prolonged and expensive litigation, and a catastrophic fire at one of the Debtors’ primary operating facilities—materially impaired liquidity and forced the Debtors to seek chapter 11 protection.”

Meanwhile, overall business bankruptcy filings have risen over the past year. Total commercial bankruptcy filings increased by 21 percent year-over-year in February, the American Bankruptcy Institute said in a March 4 statement.

Commercial Chapter 11 filings specifically were up 67 percent over the year. Small business filings, captured as subchapter V elections within Chapter 11, jumped by 91 percent.

Michael Hunter, vice president of bankruptcy data provider Epiq AACER, said, “The significant increases in Subchapter V elections reflect the reality that many small businesses are operating in a challenging environment with higher borrowing costs, softening consumer demand, and tighter lending standards.”

Reuters contributed to this report.