Movement Labs Files for Bankruptcy Following MOVE Token Crash

A Movement Labs, the developer of the Layer 2 blockchain Movement, has filed for bankruptcy under Chapter 11 in a U.S. bankruptcy court located in Delaware. This decision comes after months of financial difficulties and a crisis triggered by the launch of the MOVE token, which resulted in billions in market value losses and jeopardized the project's sustainability.

Documents submitted to the court indicate that the company has fewer than 1,000 creditors. Additionally, its assets are estimated to be between US$ 100 million and US$ 500 million, while its liabilities exceed US$ 1 million.

The largest unsecured creditor is former co-founder Ruhikesh Manche, with an outstanding amount exceeding US$ 1.6 million. The creditor list also includes the Delaware Division of Revenue and Anchorage Digital. The first hearing related to this process is scheduled for August 20.

The origins of the crisis can be traced back to December 2024, when the MOVE token was launched on the market. Almost immediately after its debut on Binance, approximately US$ 66 million worth of tokens were sold as part of a market-making agreement with Rentech.

The sudden increase in supply put pressure on the cryptocurrency's price, wiping out billions in market value within just a few days. Subsequently, Binance banned Rentech's related activities, citing that the company had nearly sold its entire position just one day after the listing and had only executed minimal buy order volumes.

In response to this incident, Movement Labs initiated a buyback program for the MOVE token, aiming to recover some liquidity within the ecosystem. The company also hired Groom Lake to review the agreement made with Rentech.

Investigations revealed a connection between Rentech and the Chinese brokerage Web3Port, a finding that led to the dismissal of Ruhikesh Manche during the scandal.

Despite the current difficulties, the company had previously raised approximately US$ 141.4 million through various funding rounds, including a Series A round led by Polychain Capital. Nevertheless, the reality indicated by network activity metrics is far from the expectations created by the funding.

Data from DeFiLlama shows that since November 2025, the protocol's daily revenue has remained below US$ 800.

Meanwhile, the token MOVE hit its all-time low on July 20. After trading close to US$ 0.041, the asset fell to about US$ 0.01043 in January, marking a cumulative decline of over 99% from its historical record of US$ 1.45.

Despite the significant drop in this cryptocurrency, the total value locked (TVL) in the network remains around US$ 133 million.

Originally developed to connect blockchains built using the Move language, Movement announced a strategic shift in June. The company began prioritizing solutions for international payments, remittances, and products aimed at dollar-based economies, attempting to reposition the platform amid declining on-chain activity and waning investor confidence.

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