Bitcoin floats above $17,000, BlockFi set to release financial statements amid bankruptcy chatter

Yahoo Finance crypto reporter David Hollerith outlines the latest bitcoin price trends and BlockFi's plans to release a statement on Wednesday amid bankruptcy speculations and crypto contagion concerns tied to FTX.

Video transcript

SEANA SMITH: Bitcoin breaking above 17,000 after trading in that $16,000 range for roughly three weeks, certainly staying there, at least for now, above 17. Let's talk about what to expect going forward with Yahoo Finance's David Hollerith joining us. And David, some buying there, some movement to the upside along with stocks on the heels of that jobs report that we got last week.

DAVID HOLLERITH: Right, yeah, I mean, over the weekend too, we saw-- especially last night, we saw sort of a slight-- what you'd call a slight rally. And analysts are saying that the crypto market shift largely appears to be driven by macro events this week. Like stock and bond investors, crypto traders might be grabbing a hold of the latest inflation and employment data as a reason to believe the market could be turning around.

And while it hasn't been the case lately, Bitcoin and other cryptocurrencies are usually more volatile and trade ahead of other assets during rallies and selloffs. So the events that they're paying attention to this week, no doubt, would be the latest inflation reading and then any sort of evidence, clarification on digital assets from bank earnings. And then also tomorrow we'll have Fed Chair Powell's speech at the Reichsbank symposium. And that may also provide a reminder to the market that the Fed's job is far from over.

So we're seeing this, as many observers, I think, are seeing this turnaround as maybe a tenuous bet at this point. But crypto investors are clearly in need of some recovery. And this is sort of a reminder that cryptocurrencies, Bitcoin and Ethereum most of all, are macro assets. And that's how they've traded, despite these industry-specific events that have been major selloffs, such as the FTX collapse and what we saw over the summer.

DAVE BRIGGS: And David, BlockFi in bankruptcy court today. What's the latest there?

DAVID HOLLERITH: Yeah, BlockFi plans to file a schedule of assets and liabilities and statement of their financial affairs on Wednesday. And this is going to give creditors and other onlookers a better view into the company's balance sheet gap between its assets versus how much it owes customers.

Lawyers representing BlockFi, who also represent Celsius Network, also made a point of showing that the company's executives did not make any crypto asset withdrawals on BlockFi's platform prior to October 14. Obviously, BlockFi filed for bankruptcy in November. And the point here is-- at least he was suggesting that, unlike Celsius, there's probably less evidence of fraudulent insider activity in this case.

The judge, also during the hearing, denied BlockFi's request for the turnover of the coveted $470 million worth of Robinhood shares that was purchased by FTX's former CEO Sam Bankman-Fried. Now, on Friday, we did find out that the Justice Department clarified that they had taken possession of those shares and $21 million in cash from an SBF-linked company.

And at this point, it's just too early to determine who has ownership over those assets, whether it's BlockFi because, shortly before filing for bankruptcy, SBF did promise them as collateral for a loan, or if it belongs to the FTX bankruptcy estate. But that decision needs to be determined at a later date. And the judge has denied the motion.

DAVE BRIGGS: OK, David Hollerith there with the latest in the crypto space. Thank you, sir, appreciate that.