Megan Crowell, chief human resources officer at crypto lending firm BlockFi, has filed a lawsuit seeking bonuses for “key employees” in Chapter 11 bankruptcy proceedings.
In a Jan. 23 filing for the U.S. Bankruptcy Court for the District of New Jersey, Crowell said that without certain financial incentives, BlockFi would not be able to retain employees in the “highly competitive” crypto industry. According to the BlockFi executive, many employees are “very likely to leave the company” during the Chapter 11 process without “competitive compensation,” potentially driving up costs down the road.
“The war for talent remains active and there are many opportunities for participants inside and outside the cryptocurrency sector,” Crowell said. “People with a background in cryptocurrencies are attractive to employers in finance, technology, and payment platforms in general, among other things, especially as these industries adapt their products and services to include cryptocurrencies and/or related technologies.”
“If additional Participants retire, I believe it will be difficult for Debtors to find adequate candidates who can effectively operate the BlockFi platform, which severely limits Debtors’ ability to handle these Chapter 11 cases. Moreover, hiring new employees will require significant operating and financial costs.
BlockFi filed for bankruptcy on November 28, saying the firm had about $257 million at the time. He filed a motion to “develop a key employee retention plan to ensure the company retains trained internal resources to perform business-critical functions,” as the jobs were not subject to the layoffs. The proposed plan would offer employees bonuses of 20-50% of their pay if they stay with the firm as of Jan. 31, Crowell said.
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Crowell said some “critical” employees have already accepted offers from Google, Block and Walmart since filing for bankruptcy in November, in some cases “for compensation significantly in excess of their current compensation.” Her LinkedIn revealed that she joined BlockFi in July 2019, working in various talent recruitment roles.
Numerous crypto firms, including FTX, Celsius Network, Genesis and Voyager Digital, filed for Chapter 11 bankruptcy last year, with many users reporting losses totaling millions of dollars.