Block Fi Account

[ppd742]

Jurisdiction

Texas

I have an account with Block Fi and I requested to withdraw my money a day before they announced they would be halting withdrawals. Unfortunately they halted with draws and I am unable to get my money out which is a few thousand. I hear they have filed for bankruptcy. What can I do ? Are they legally allowed to just steal my money ? Doesn't make sense how they would be able to do that. What are my options?

 

[zddoodah]

What can I do ?

I don't know who or what "Block Fi" is. What sort of account is this? Bank account? Investment account? Something else? Regardless, the answer to your question depends, first and foremost, on the terms of your account agreement. However, if the entity has filed for bankruptcy, your recourse will be much more limited.

When a person or entity files for bankruptcy, there is an automatic stay against any action against the company without further order from the bankruptcy court. Your options will be to make a claim in the bankruptcy and/or seek an order for relief from the automatic stay.

Are they legally allowed to just steal my money ?

No one is stealing anything.

 

[Zigner]

I don't know who or what "Block Fi" is.

BlockFi files for bankruptcy as FTX contagion grips crypto markets | CNN Business

 

[hrforme]

when you put $s into uninsured investments, there is always a chance for a total loss.

 

[flyingron]

BlockFi did indeed file chapter 11 today.

 

[adjusterjack]

I am unable to get my money out which is a few thousand.

Be thankful that's all you lost. Could have been a lot worse.

Cryptocurrency was an unregulated house of cards from the getgo. No surprise that people are losing tons of money.

 

[flyingron]

Derivative products of nothingness.

 

[Tax Counsel]

What can I do ?

You can file a claim with the bankruptcy court and stand in line with all the other creditors that are owed money. While the company is in bankrtuptcy that's pretty much all you can do.

Are they legally allowed to just steal my money ?

It's not theft and it's not illegal. When you invested in crypto currency you take a risk that the currency will become worthless for any number of reasons. There is no guarantee backing that currency like you would get with a FDIC insured bank account. A lot of people make the mistake of regarding crypto currency like cash. Unfortunately, cryto currency is very much not like cash which is one of the things that gives rise to the risk. When you invest in things like this you are expected to understand the risk that you are taking and if the investment goes broke there's not much you can do about it. Crypto currency right now is more risky than going to a casino to gamble. At least at the casino you can calculate your odds of winning. Crypto currencies have such wide and fast changes in value that it's a crap shoot what it'll be worth on any given day.

 

[adjusterjack]

At least at the casino you can calculate your odds of winning.

And you get free booze to console you when you lose.

 

[Tax Counsel]

And you get free booze to console you when you lose.

Usually cheap food, too. They want to keep you in the casino gambling, not leaving to get a bite to eat.

 

[flyingron]

Y
It's not theft and it's not illegal.

It depends if they actually purchased the crypto that he contracted with. Some of these exchanges are outright frauds. It goes beyond the intangibility of crytpocurrency.

Still, it doesn't bode well for getting his money back either way.

 

[army judge]

What Are the Risks of Investing in Crypto?

Here are a few of the more common risks in cryptocurrency investment:

Volatility risk. Crypto prices frequently exhibit extreme swings during certain economic or market conditions.

Liquidity risk. Some cryptocurrencies trade with light volume, and thus can be easily manipulated by buyers with large capital resources or sellers who have a large stake in a given currency.

Cybersecurity risk. Your crypto can be stolen if a bad actor has access to your crypto wallet's private key.

Overnight risk. Because crypto trades 24/7, your holdings are subject to adverse fluctuations overnight.

Vanishing risk. There are factors that have caused certain crypto coins to vanish; these instances are rare and unique to particular coins.

The Bottom Line

Although the original idea behind cryptocurrency was to create an alternative monetary asset, many investors purchase cryptocurrency not as money, but as an alternative asset or a way to invest in its underlying blockchain technology.

Crypto is an emerging field, not unlike the technology sector in the 1990s.

There are plenty of brilliant ideas in the crypto world, but not every blockchain innovation will find its way to mainstream use.

So, if you're planning on investing in cryptocurrencies, proceed with a healthy dose of caution.

Britannica Money
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