BlockFills halts deposits and withdrawals as Bitcoin drops

Crypto liquidity provider BlockFills has paused client deposits and withdrawals following a sharp fall in bitcoin prices, highlighting fresh stress in digital asset markets. The Chicago-based firm said it halted withdrawals last week and is working to restore liquidity across its platform.

The move comes after renewed volatility in the crypto market triggered by a steep decline in bitcoin and other digital assets. BlockFills said the suspension is temporary and that it remains in active discussions with its institutional clients.

Temporary pause on withdrawals

BlockFills confirmed in a statement on Wednesday that it stopped withdrawals last week as it seeks to stabilise liquidity. The company said clients can still open and close positions in spot and derivatives trading despite the halt on fund movements.

“In light of recent market and financial conditions, and to further the protection of clients and the firm, BlockFills took the action last week of temporarily suspending client deposits and withdrawals. Clients have been able to continue trading with BlockFills for the purpose of opening and closing positions in spot and derivatives* trading and select other circumstances,” the company said.

According to Reuters, a spokesperson said the firm is “working tirelessly” to resolve the issue and will provide updates as developments warrant. The company did not specify when withdrawals would resume.  

Institutional client base and trading volume

The company serves more than 2,000 institutional clients, including crypto hedge funds and asset managers. According to its website, the company facilitated more than $61.1 billion in trading volume in 2025.

The firm raised $6 million in 2021 and a further $37 million in 2022. Investors include CME Ventures and Susquehanna Capital, according to PitchBook data.

The funding rounds helped BlockFills expand its liquidity services and trading infrastructure during a period of rapid growth in digital asset markets.

Market volatility weighs on crypto prices

The withdrawal pause follows a sharp downturn in bitcoin and broader crypto markets. On 30 January, precious metals and cryptocurrencies sold off heavily after US President Donald Trump named Kevin Warsh as the next chair of the Federal Reserve.

Market participants expect Warsh could shrink the Fed’s balance sheet, a move that may reduce liquidity in financial markets and potentially lower demand for risk assets such as bitcoin.

Digital asset prices have since remained volatile. Bitcoin fell 20 percent last Thursday and was last down more than 3 percent at $66,534. The cryptocurrency had previously reached an all-time high above $125,000 in October.

Wider impact on crypto firms

BlockFills’ decision to halt withdrawals reflects the knock-on effects that rapid price declines can have on crypto lenders and liquidity providers. Such firms often rely on steady trading flows and access to capital to manage client positions and funding requirements.

Despite the pause on deposits and withdrawals, the company said trading activity continues on its platform. Clients are still able to manage their spot and derivatives positions.

The company has not disclosed whether the liquidity strain is linked to counterparty exposure, client redemptions or broader market conditions. It has stated only that it is taking steps to restore liquidity and bring the matter to a conclusion.

The latest developments underline the sensitivity of crypto service providers to sudden market shifts, especially during periods of high volatility in bitcoin and other digital assets.