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Bankruptcy After MOVE Turmoil
Movement Labs, the developer behind the Movement blockchain, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on July 15, according to court records cited by CoinDesk.
“Movement Labs, the developer behind the MOVE cryptocurrency token, has filed for Chapter 11 bankruptcy protection, marking a significant downturn for a project that once aimed to compete in the Ethereum layer-two ecosystem”
The filing followed months of upheaval tied to the December launch of the MOVE token, including a market-making agreement that enabled the rapid sale of 66 million MOVE tokens and triggered a steep price drop.
CoinDesk reported that Movement was examining whether it had been misled into signing a market-making agreement that handed a single counterparty unusual influence over MOVE's circulating supply, with internal documents reviewed showing 66 million MOVE tokens sold into the market one day after the token debuted.
CoinDesk also said the company’s bankruptcy filing listed under 1,000 creditors, somewhere between $100,000 and $500,000 in assets, and north of $1 million in liabilities, with its largest creditors including co-founder Rushi Manche, the Delaware Division of Revenue, and Anchorage Digital.
In parallel, Movement Labs’ troubles were linked to Binance banning the market-making account involved in the token launch for what it described as misconduct, while Movement launched a token buyback program and hired outside firm Groom Lake to review the events surrounding the deal.
Torab: Separate Entity
After the bankruptcy news, Move Industries CEO Torab Torabi wrote on X that the case applied only to Movement Labs, saying, “Move Industries is operating normally. We continue to put our heads down and build.”
Crypto Briefing also framed the separation by noting that Move Industries said the bankruptcy filing does not affect operations, and it quoted Torab clarifying that MVMT Labs is “a separate legal entity” and that Move Industries is “operating normally.”
CoinDesk’s account of the underlying dispute centered on a market-making arrangement involving Rentech, a little-known intermediary that appeared in contracts connected to Chinese market maker Web3Port, and it said Rentech denied any wrongdoing or misrepresentation.
CoinDesk reported that Binance banned the market-making account tied to the token launch for what it described as misconduct, and it said Movement launched a token buyback program and hired outside firm Groom Lake to review the deal.
CoinGape added that court filings showed the firm’s liabilities were worth over $1 million and that the MOVE token was trading flat amid the broader crypto market rally, while also citing Binance’s ban and freezing of profits linked to the token sales.
What Comes Next
The bankruptcy filing places Movement Labs’ restructuring under court supervision, with The Defiant reporting that the voluntary petition was docketed as case number 26-11113 and assigned to Judge Thomas M. Horan in the U.S. Bankruptcy Court for the District of Delaware.
“Summary - Movement Labs filed for bankruptcy protection under Chapter 11 of the U”
The Defiant said the petition lists assets of between $100,001 and $1 million, liabilities of between $1 million and $10 million, and 200 to 999 creditors, and it reported that a meeting of creditors is scheduled for Aug. 20 and the deadline for filing proofs of claim is Sept. 14.
CoinDesk reported that Movement Labs’ largest creditors include co-founder Rushi Manche, the Delaware Division of Revenue, and Anchorage Digital, and it said the company’s filing followed a year navigating governance disputes, a token market-making controversy, and a failed strategic reset.
Crypto Briefing described the strategic pivot that Move Industries made after the turmoil, saying it shifted focus toward cross-border payments, remittances and stablecoin settlement and that it obtained access to licensed payment infrastructure in the U.S., Canada and the European Union.
CoinDesk also said it remains unclear how the Chapter 11 process will affect Movement’s blockchain, partnerships, or plans to expand its payments business, as the company attempted to chart a new course after the MOVE token controversy.
