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Cred, Crypto Lender Filed for Bankruptcy After Fraudulent Fund Loss

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Cred, Crypto Lender Filed for Bankruptcy After Fraudulent Fund Loss

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Cryptocurrency lender Cred Inc. filed for Chapter 11 bankruptcy protection in Delaware on Saturday.

In his documents, Cred listed assets valued at $ 50 million to $ 100 million and liabilities between $ 100 million and $ 500 million.

In an emailed press release, Clyde stated that Grant Lyon has been appointed to the company’s board of directors to oversee the restructuring process. In addition, the MACCO Restructuring Group was hired as financial advisor to assess mergers and acquisitions and other restructuring opportunities.

Cred Suspend Activities Temporary

In October, the lender issued a vague letter stating that it had committed “violations” of “certain” company funds by “perpetrators of fraudulent activities.” In response, Cred said that the Legal Adviser recommended that the inflow and outflow of funds related to the CredEarn program be temporarily suspended.

At the same time, the wallet and trading platform Uphold notified customers that they “have decided to end the relationship with Cred”.

In addition, Uphold said in a tweet on Sunday that it intends to seek legal damages for “breach of contract, fraud and related claims” on behalf of its customers.

With several crypto lenders battling Bitcoin (BTC, -2.12%) crash in March, Cred may already be in a vulnerable position, some of which have increased margin requirements of $ 100 million or more.

Cred’s CEO Dan Schatt did not immediately respond to a request for comment.

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