Image Credit: Keyrock
Key Takeaways
- Keyrock closed its acquisition of BlockFills’ institutional trading assets for $3.25 million after winning a bankruptcy court auction.
- The deal adds institutional client relationships, derivatives trading technology, and regulatory licenses, including CIMA and FCA registrations.
- Several senior BlockFills executives, including Perry Parker and Dan Schak, are joining Keyrock along with the firm’s trading and operations teams.
Digital-asset services firm Keyrock has completed its acquisition of the institutional trading and brokerage assets of BlockFills, the Chicago-based crypto trading and lending firm that filed for Chapter 11 bankruptcy in March, the Brussels-based company said in a statement. The deal adds institutional client relationships, derivatives trading technology and regulatory licenses to Keyrock’s existing market-making, over-the-counter trading and asset management businesses.
From Bankruptcy Auction to Completed Deal
BlockFills’ parent company, Reliz Ltd., along with three affiliated entities, filed voluntary Chapter 11 petitions in the U.S. Bankruptcy Court for the District of Delaware on March 15, following significant losses tied to a February crypto market crash. Court filings at the time showed the company reporting between $100 million and $500 million in liabilities against only $50 million to $100 million in assets.
Keyrock was declared the successful bidder for BlockFills’ assets in a bankruptcy court filing dated May 26, agreeing to pay $3.25 million for substantially all of the company’s assets. The deal included assuming certain liabilities, portions of its equity interests, customer lists and proprietary technology, according to the bankruptcy filing. A court hearing to approve the sale was held June 16, and the transaction has now closed following court and regulatory approval.
What Keyrock Is Gaining
BlockFills provided institutional clients with liquidity, financing and risk-management services, including crypto lending and borrowing, derivatives trading and OTC execution, serving a customer base of hedge funds, asset managers, market makers and mining companies. Keyrock said the completed deal broadens its regulatory footprint through a CIMA-registered entity in the Cayman Islands and the proposed acquisition of an FCA-authorized entity in the United Kingdom, the latter still subject to regulatory approval.
The company said the combined platform will give institutional clients enhanced execution capabilities backed by Keyrock’s balance sheet and regulatory infrastructure, and that it will integrate BlockFills’ business in phases while communicating directly with affected clients as services roll out.
Executives and Teams Joining Keyrock
Several senior BlockFills executives are joining Keyrock as part of the deal, including Perry Parker, a former Goldman Sachs and Deutsche Bank derivatives executive who led institutional options trading at BlockFills, and Dan Schak, who oversaw the firm’s risk and trading operations. BlockFills’ broader trading, operations and commercial teams are also transferring to Keyrock.
Keyrock said the acquisition strengthens one of its fastest-growing business lines, digital asset derivatives, at a time when institutional demand for crypto options and other derivatives products continues to expand.
Part of a Broader Institutional Push
The deal extends a period of expansion for Keyrock, which closed a Series C funding round last year led by SC Ventures, the venture arm of Standard Chartered Bank, at a valuation of $1.1 billion, and acquired Luxembourg-based fund manager Turing Capital last fall. The BlockFills transaction gives Keyrock access to a client base and derivatives infrastructure that Keyrock has said would otherwise have taken years to build organically. It also means absorbing a business that entered bankruptcy after sustaining an estimated $75 million in losses tied to its lending and credit operations under prior ownership.
