A US federal court has temporarily frozen cryptocurrency assets linked to institutional trading platform Blockfills as part of an ongoing legal dispute with investment firm Dominion Capital.
Conclusion
- A federal judge issued a temporary restraining order preventing Blockfills from transferring Bitcoin allegedly owned by Dominion Capital.
- Dominion claims the platform pooled and used customer funds to cover operating losses, creating a $77 million balance sheet deficit.
- The decision comes after the company halted redemptions and reported heavy loan losses amid widespread market pressure.
Court steps in and freezes 70 BTC after blocking Blockfills withdrawal
In a temporary restraining order issued by the Southern District Court of New York, the court prohibited Blockfills from transferring or disposing of approximately 70.6 bitcoins allegedly owned by Dominion Capital while the case is pending.
The order came after Dominion filed a complaint accusing Blockfills of misappropriating and commingling customer funds and refusing to return assets after it suspended withdrawals earlier this year.
According to the filing, Dominion held approximately 70.55 BTC and a cash balance on the platform. The company claims it was unable to access the funds after Blockfills suddenly stopped accepting funds in early February 2026.
Dominion further alleges that Blockfills admitted in internal customer meetings that customer assets would be consolidated into a single balance sheet and used to cover operating expenses and business losses, leaving the company with a balance sheet deficit of approximately $77 million by the end of 2025.
Judge Mary Kay Viscosil issued the emergency order after Dominion argued there was a risk it would transfer or run out of assets before the case could be fully heard. The decision prevents Blockfills from transferring the disputed Bitcoin or related assets outside the United States pending further proceedings.
The legal action comes amid growing pressure on the Chicago-based crypto broker. Earlier reports indicated that the company suffered about $75 million in loan losses during the recent market downturn, prompting management changes and discussions about a possible sale or financing.
The temporary restraining order will remain in place until a trial determines whether a lengthy sentence should be imposed when the lawsuit is filed.
