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Bankrupt crypto lender BlockFi had over $1.2 billion in assets tied up with Sam Bankman-Fried’s FTX and Alameda Research, according to financials that had previously been redacted but were mistakenly uploaded yesterday without the redactions, CNBC.com reported. BlockFi’s exposure to FTX was greater than prior disclosures suggested. The company filed for Chapter 11 bankruptcy protection in late November, following the collapse of FTX, which had agreed to rescue the struggling lender before its own meltdown. The balance shown in the unredacted BlockFi filing includes $415.9 million worth of assets linked to FTX and $831.3 million in loans to Alameda. Those figures are as of Jan. 14. Both of Bankman-Fried’s firms were wrapped into FTX’s November bankruptcy, which sent the crypto markets reeling. Lawyers for BlockFi had said earlier that the loan to Alameda was valued at $671 million, while there were an additional $355 million in digital assets frozen on the FTX platform. Bitcoin and ether have since rallied, lifting the value of those holdings.

Over the past few years, a number of companies have attempted to act as the cryptocurrency equivalent of a bank, promising lucrative returns to customers who deposited their bitcoin or other digital assets, according to an Associated Press analysis. In a span of less than 12 months, nearly all of the biggest of those companies have failed spectacularly. Last week, Genesis filed chapter 11, joining Voyager Digital, Celsius and BlockFi on the list of companies that have either filed for bankruptcy protection or gone out of business. This subset of the industry grew as cryptocurrency enthusiasts were looking to build their own parallel world in finance untethered to traditional banking and government-issued currencies. But lacking safeguards, and without a government backstop, these companies failed in domino-like fashion. What started with one crypto company collapsing in May spilled over onto one crypto lending firm and then the next. Further, government regulators started clamping down on crypto lending companies’ ability to advertise their services, saying that their products should have been regulated by securities regulators. The collapse is reminiscent of the 2008 financial crisis, but on a much smaller scale. There are no worries that the collapse of these crypto firms will impact the broader economy.

Rockley Photonics Holdings Ltd., which makes microchips that can be used in wearable health monitoring devices, filed for bankruptcy with a creditor-backed plan that will hand control of the business to bondholders, WSJ Pro Bankruptcy reported. Publicly traded Rockley said in court papers filed Monday in the U.S. Bankruptcy Court in New York that it has won support for a chapter 11 plan of reorganization under which bondholders who are owed roughly $119 million will forgive that debt in exchange for equity in the reorganized business. Bondholders also agreed to provide Rockley with $35 million in new financing in the form of a chapter 11 exit loan and private placement agreement offering bondholders the right to purchase an additional $20 million of the reorganized company’s stock. Rockley said the restructuring plan was negotiated and agreed to following a monthslong marketing process spearheaded by the company’s investment banker, Jefferies LLC. Rockley said that although it has developed groundbreaking silicon photonics chips that can be used in wearable health monitoring devices, the company has yet to bring any products to market. The company said it is working with other businesses on specific designs for its chips and it has shipped some early prototypes, anticipating the chips will ultimately be used in wearable health monitoring devices. President and Chief Executive Richard Meier said in a sworn statement that Rockley recorded net losses of $117 million in the nine months ended Sept. 30. Mr. Meier said the chapter 11 plan is a significant achievement given Rockley’s liquidity issues and added the restructuring should ensure the company’s long-term viability.

Serta Simmons Bedding is seeking bankruptcy protection in an effort to trim its debt load following an earlier out-of-court restructuring, Bloomberg News reported. The Atlanta-based mattress maker filed in the Southern District of Texas on Monday. The chapter 11 filing allows Serta to continue operating while implementing a deal, backed by a majority of lenders and shareholders, to cut its debt to $300 million from $1.9 billion, the company said in a statement. The firm also obtained a $125 million debtor-in-possession ABL credit facility, it said. Facing financial distress amid the pandemic, Serta agreed on a previous restructuring with creditors in 2020 that added $200 million of fresh capital while allowing some lenders to jump to the front of the repayment line. Other lenders were pushed back, a process known as priming. A group of funds including Angelo Gordon & Co. and Apollo Global Management sued Serta and rival lenders in the hopes of invalidating the transaction. The company’s debt, which stems from a roughly $3 billion leveraged buyout by Advent International in 2012, has hobbled the retailer. Confidential talks over a restructuring plan started late last year, Bloomberg earlier reported.

Bankrupt crypto lender Genesis Global Capital LLC expects a deal with major creditors to come together within days to provide a framework for a possible sale of the lending business or a restart of operations, WSJ Pro Bankruptcy reported. Lawyers for the bankrupt crypto lender said in a court hearing that Genesis has been in round-the-clock negotiations with its parent company and largest borrower, Digital Currency Group Inc., as well as creditors and other stakeholders, but couldn’t seal a restructuring settlement before filing chapter 11 last week. “We are quite close,” said Sean O’Neal, a lawyer for Genesis, at Monday’s hearing in the U.S. Bankruptcy Court in New York. Absent a resolution “within the next few days,” Genesis will return to bankruptcy court to seek the appointment of a mediator, Mr. O’Neal said. A resolution with institutions that put their clients’ money with Genesis is important to jump-start other parts of its chapter 11 exit framework, including the marketing of its assets for sale and a possible capital raise, he said. Genesis Global Holdco and its subsidiaries Genesis Global Capital LLC and Genesis Asia Pacific Pte. Ltd. filed for chapter 11 largely because of their entanglements with failed crypto exchange FTX and hedge fund Three Arrows Capital. Genesis took deposits from institutional customers and lent those assets out, often to hedge funds for speculation on crypto markets. The company’s chapter 11 filing doesn’t cover its derivatives, spot trading, custody and brokerage arms, which continue business as usual.

Not long before FTX collapsed in November, its founder, Sam Bankman-Fried, sent $400 million to an obscure cryptocurrency trading firm called Modulo Capital, the New York Times reported. The fledgling firm, which was founded in March and operated out of the same Bahamian compound where Mr. Bankman-Fried lived, had no track record or public profile. One of the founders, Duncan Rheingans-Yoo, was only two years out of college. His business partner, Xiaoyun Zhang, known as Lily, was a former Wall Street trader who had previously been romantically involved with Mr. Bankman-Fried, according to four people with knowledge of their relationship. Now, Modulo is emerging as a crucial part of the investigation by federal prosecutors into Mr. Bankman-Fried and his once giant cryptocurrency exchange. They’re examining whether he used FTX’s customer funds to invest in the little-known firm when his existing hedge fund, Alameda Research, was struggling amid a wider crypto industry downturn. The $400 million outlay was one of Mr. Bankman-Fried’s single largest investments.

Camp Trexler drapes across 755 sylvan acres in the Poconos where, for a century, Boy Scouts have enjoyed swimming, making campfires, and hiking. But the forested land, complete with lake, is expected to soon go up for sale with zoning that could transform it into a housing development amid the rural hamlet of Jonas in Polk Township, Monroe County, the Philadelphia Inquirer reported. The camp’s owner, the Minsi Trails Council of the Boy Scouts, is one of 250 local councils across the United States under pressure to pay toward a $2.5 billion national sex-abuse settlement that led to the organization’s bankruptcy. Some scout groups are cash-poor but land-rich, prompting them to put thousands of acres for sale. The sales have set off a mad scramble as the scouts try to sell to the highest bidder, while conservationists rally to preserve what they can. The best scenario, conservationists say, is to have the lands bought by states and folded into public lands. It’s no trivial matter: Scouting organizations own about 17,000 mostly forested acres in Pennsylvania alone. The Boy Scouts of America filed chapter 11 protection in February 2020 after states began allowing sex-abuse victims to sue over claims stretching back decades. More than 82,000 abuse claims have been filed against the scouts. The organization says 85% or more of those claims are from before 1990, predating modern child protection policies. Most of them date to the 1970s. Victims who became creditors in the bankruptcy reorganization stand to gain parts of a $2.46 billion settlement trust for victims. The national scouts organization and its 250 local councils are on the hook for $820 million. A federal district judge still needs to give final approval to the plan, which also calls for contributions by insurance companies.

Sullivan & Cromwell LLP won court approval to continue representing FTX in bankruptcy following weeks of scrutiny about work the law firm did for the crypto exchange and former executives before the company’s collapse in November, WSJ Pro Bankruptcy reported. Judge John Dorsey of the U.S. Bankruptcy Court in Wilmington, Del., said Friday there is no evidence of any conflicts of interest that would warrant removing Sullivan from the bankruptcy case. Judge Dorsey rejected a challenge brought by two customers of the exchange who argued the law firm’s past work for FTX and its co-founder and former Chief Executive Sam Bankman-Fried should have disqualified it from representing the company in bankruptcy. The decision caps weeks of intense scrutiny of the law firm over its previous connections to the company. A bipartisan group of U.S. senators and the Justice Department’s bankruptcy watchdog this month both sought more information on the law firm’s previous relationship with FTX. Sullivan resolved the questions after providing a sworn statement by one of its lawyers detailing its past work for FTX.

Federal authorities said on Friday they have seized additional assets tied to FTX, continuing an effort to take control of hundreds of millions of dollars in the U.S. tied to the failed crypto exchange, WSJ Pro Bankruptcy reported. In a filing with the U.S. Bankruptcy Court in Wilmington, Del., the Justice Department said it has seized $56 million in U.S. currency and 87 million euros, equivalent to roughly $94.5 million, from accounts at Moonstone Bank and Silvergate Capital Corp. The amount was in addition to the 55.3 million shares of brokerage Robinhood Markets Inc. and $20.7 million in U.S. currency that the Justice Department said earlier this month it had seized from an account at financial brokerage firm ED&F Man Capital Markets, court records show. FTX and BlockFi, a crypto lender that also filed for bankruptcy, are disputing the ownership of the Robinhood shares. The U.S. government has forcefully taken control of some of the assets tied to FTX since its bankruptcy in November as the battle over control of the remaining funds heats up. Authorities are also investigating FTX founder Sam Bankman-Fried over charges that include wire fraud, conspiracy to commit money laundering and securities fraud, and conspiracy to defraud the U.S.

Crypto lender Genesis Global Holdco LLC is aiming for a relatively quick exit from bankruptcy court after collapsing under the force of a prolonged selloff in digital assets, Bloomberg News reported. The company, backed by Barry Silbert’s Digital Currency Group, filed for chapter 11 bankruptcy in New York late Thursday. It entered court protection with a restructuring plan already drawn up, with hopes to implement it no later than May 19, bankruptcy filings show. Genesis will try to sell itself and distribute the proceeds to creditors, according to a statement. If a sale isn’t viable, creditors would receive stock in the restructured company. That plan isn’t final and requires approval from a federal judge, as well as input from any creditors getting hurt along the way. These include Gemini Trust Co., the crypto firm run by Tyler and Cameron Winklevoss, who have been pushing Silbert to make good on $900 million of its customers’ funds that have been trapped since Genesis ran into trouble in November. If successful, the four-month restructuring would amount to a much faster process than has been seen for other collapsed crypto lenders like Voyager Digital Ltd. and Celsius Network LLC. Genesis is seeking bids for all of its assets no later than April 14, the court papers show.