Bittrex, A Bankrupt Crypto Exchange Borrowing Bitcoin Worth IDR 103 Billion

Bittrex pinjam Bitcoin. (Photo; Doc. News2day)

JAKARTA - Bittrex Inc., the crypto exchange that filed for bankruptcy, has obtained approval from the US Court to borrow Bitcoin (BTC) worth US$7 million (Rp103 billion) to finance the initial bankruptcy case of its Chapter 11.

In this regard, bankruptcy judge Brendan Shannon approved the exchange's request on an interim basis in a court hearing in Wilmington, Delaware on Wednesday.

For information, Bittrex Global, a crypto company based in Liechtenstein, has been excluded from bankruptcy filings. However, Bittrex Malta Ltd. and Bittrex Malta Holdings are the two branch companies affected.

The bankruptcy filing comes weeks after the company announced it would leave the US in March due to regulatory challenges, accepting Wells Notice from the SEC for alleged violations of investor protection laws and unregistered securities exchange operations.

Before going bankrupt, Bittrex stopped accepting new deposits from US customers and asked existing users to withdraw their crypto assets. According to court records, on March 27, the market share of US customers at the exchange is a minority of its total users, while affiliates at Liechtenstein and cover it account for about 77 percent of the company's 5.4 million clients.

At a hearing last Wednesday, Bittrex's lawyer, Susheel Kirpalani, told Judge Shannon that BTC's bankruptcy loan would ensure a smooth business termination process and protect user assets, as the company has enough crypto to handle all customer withdrawals.

Judge Shannon allowed Bittrex to borrow 250 BTC fromquila Holdings, the parent company that was not affected by bankruptcy. At another hearing in June, the exchange will seek permission to borrow an additional 450 BTC, completing the proposed loan to 19.7 million US dollars (Rp290 billion), based on the price of bitcoin at the time of filing for bankruptcy.