BlockFi exec argues bankruptcy court should approve bonuses to retain talent

Megan Crowell, the main radical serviceman astatine crypto lending steadfast BlockFi, has petitioned a tribunal to let bonuses for “key employees” amid Chapter 11 bankruptcy proceedings.

In a Jan. 23 declaration for United State Bankruptcy Court successful the District of New Jersey, Crowell said without giving definite fiscal incentives, BlockFi mightiness beryllium incapable to clasp employees successful a “highly competitive” crypto industry. According to the BlockFi executive, galore unit were “highly apt to permission the company” amid the Chapter 11 process without “competitive compensation”, perchance adding to costs down the road.

“The warfare for endowment remains active, and the Participants person galore opportunities wrong and extracurricular the cryptocurrency sector,” said Crowell. “Individuals with cryptocurrency acquisition are charismatic to employers successful the finance, technology, and outgo level industries broadly, among others, particularly arsenic these industries accommodate their products and services to incorporated cryptocurrency and oregon related technologies.”

She added:

“In the lawsuit further Participants resign, I judge that the Debtors would conflict to adequately root candidates who could run the BlockFi level effectively, severely limiting the Debtors’ options successful these section 11 cases. Moreover, hiring caller employees would necessitate the Debtors to incur important operational and fiscal costs.”

BlockFi filed for bankruptcy connected Nov. 28, saying astatine the clip the steadfast had astir $257 cardinal connected manus and filed a question to “establish a Key Employee Retention Plan to guarantee the institution retains trained interior resources for business-critical functions” arsenic the works did not suffice for severance. According to Crowell, the projected program would connection employees bonuses of 20-50% of their salaries should they stay astatine the steadfast arsenic of Jan. 31.

Related: BlockFi bankruptcy filing triggers a wide scope of assemblage reactions

Crowell reported that definite “critical” employees had already accepted offers astatine Google, Block, and Walmart pursuing the bankruptcy filing successful November, successful immoderate cases “for compensation importantly supra their existent compensation”. Her LinkedIn showed she joined BlockFi successful July 2019, moving successful assorted roles related to recruiting talent.

Many crypto firms including FTX, Celsius Network, Genesis, and Voyager Digital filed for Chapter 11 bankruptcy successful the past year, with galore users reporting losses totaling successful the millions of dollars.