On Wednesday, November 18, two customers of Cred Inc., a
cryptocurrency investment platform currently in Chapter 11, asked
Delaware Bankruptcy Judge John T. Dorsey to convert the Chapter 11
case to a Chapter 7 liquidation (or, in the alternative, to appoint
a Chapter 11 Trustee “with expertise in hunting down . . .
stolen cryptocurrency”). Prior to its Chapter 11 filing, Cred
received investor-cryptocurrency, typically in the form of loans,
and then purportedly used those funds across a variety of
investments to generate favorable returns.
In its motion, the customers allege that Cred is “rife
with fraud and deception on ‘Madoff' level
proportions.” They argue that Cred has “grossly
mismanaged the estates” such that there is no reasonable
likelihood of rehabilitation.
