BlockFi Inc. was shocked by allegations of potential fraud at FTX, which provided the cryptocurrency lender with a financial lifeline that fell apart following FTX’s collapse, a lawyer representing BlockFi said Tuesday.
Jersey City, N.J.-based BlockFi was caught off guard by allegations of serious internal problems and potential fraud at FTX under the leadership of co-founder Sam Bankman-Fried that emerged in the weeks following the platform’s sudden collapse, Joshua Sussberg, a lawyer for BlockFi, said during its debut hearing in the U.S. Bankruptcy Court in Trenton, N.J.
