A US federal judge has issued a temporary restraining order (TRO) against crypto lender BlockFills in a lawsuit filed by Dominion Capital, temporarily freezing assets related to the litigation, according to a filing viewed by CoinDesk.
In a complaint dated February 27, Dominion alleged that BlockFills misappropriated and illegally retained millions of dollars of customer crypto assets, commingled customer assets, and concealed large losses.
Dominion claimed that BlockFills covered up the misuse of customer funds and refused to return the company’s assets after suspending withdrawals in February. As part of the complaint, the investment firm requested an asset freeze to protect its crypto trapped on the Blockfills platform, which was granted by the court.
In an order filed March 3 in the U.S. District Court for the Southern District of New York, Federal Judge Mary Kay Vyskocil barred the company from transferring or disposing of 70.6 bitcoins. allegedly belonging to Dominion, or moving assets out of the United States while the case progresses.
The court also ordered Blockfills, which is backed by trading giant Susquehanna, to account for and segregate customer funds, including Dominion’s bitcoin, pending a hearing on a possible preliminary injunction.
CoinDesk reported last month that the crypto lender suffered losses of around $75 million during the recent market downturn and was seeking a buyer or emergency funding.
BlockFills is a Chicago-based crypto trading and lending company that provides liquidity, financing, and risk management services to institutional clients. Its platform facilitates cryptocurrency lending and borrowing, derivatives trading and over-the-counter (OTC) execution for hedge funds, asset managers, market makers and mining companies.
A Blockfills spokesperson said that, as a matter of policy, the company does not comment on pending litigation. Dominion Capital declined to comment.
In the United States, a temporary restraining order is an emergency court order that temporarily prevents someone from taking a specific action until the court can hold a full hearing. It is commonly used in legal disputes involving money, assets or financial activities in order to prevent immediate harm.
The TRO was issued without notice to BlockFills, with the court citing a risk of “immediate and irreparable harm,” noting that the company had suspended customer withdrawals and that insolvency could be imminent.
BlockFills must respond by March 17, when the temporary order will expire unless extended by the court.
Dominion Capital is a New York-based private investment firm and family office that invests in private equity, structured finance and digital assets, including backing Bitcoin mining companies such as Bitfarms (BITF).
Difficult times
Blockfills said it was suspending customer withdrawals and deposits on February 11 due to recent market and financial conditions.
The company said at the time that it was working with investors and customers to achieve a speedy resolution and restore liquidity to the platform. CoinDesk then learned that the crypto lender suffered approximately $75 million in losses during the recent market downturn and was seeking a buyer or emergency financing.
CoinDesk also reported that Nicholas Hammer, co-founder and CEO of Blockfills, had resigned from his leadership role. The company’s website now lists Joseph Perry as interim CEO.
Blockfills said it processed more than $60 billion in transaction volume in 2025, an increase of 28% from the previous year, and is among the most active institutional cryptocurrency lending and borrowing desks. It serves around 2,000 institutional clients, including hedge funds, asset managers and mining companies.
“The company is now heading towards bankruptcy,” according to insolvency professional Thomas Braziel, founder of 117 Partners.
“After something like this, no serious institution touches the platform,” Braziel said. “They’re going to have to file for bankruptcy.”
The New York Law Journal first reported news of Dominion’s suit Monday.
Learn more: Blockfills co-founder and CEO Nicholas Hammer has resigned
