MVMT Labs, the original developer of the Movement blockchain, has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware, reporting assets between $100,001 and $500,000 against liabilities of up to $10 million and as many as 299 creditors. The filing follows more than a year of turmoil linked to the controversial launch and distribution of the MOVE token.
Court documents show former co-founder and CEO Rushi Manche holds the largest unsecured claim, exceeding $1.6 million, despite being removed from the company in May 2025. Other claimants include the Delaware Division of Corporations (allegedly owed $459,000), Move Industries, Anchorage Digital, and security auditor OtterSec.
The crisis intensified after MOVE debuted on exchanges in December 2024. An investigation revealed that a market-making agreement handed 66 million tokens (roughly 5% of supply) to an intermediary called Rentech, with wallets linked to market maker Web3Port selling the tokens a day after listing, generating approximately $38 million. The sale concentrated a large share of the public supply under one counterparty, contributing to a sharp price decline. Binance later banned the market-making account for misconduct and froze the profits, while Coinbase also suspended MOVE trading.
In response, the Movement Network Foundation announced a $38 million buyback plan and hired external firm Groom Lake to investigate. Leadership changes followed: Manche was terminated after allegedly signing undisclosed agreements, and core development duties were transferred to the newly formed Move Industries under CEO Torab Torabi. Move Industries has since converted Movement from an Ethereum layer‑2 into an independent layer‑1 network focused on stablecoin payments and cross‑border transfers, and it stressed that its operations remain unaffected by the bankruptcy filing.
The Chapter 11 petition seeks to reorganize MVMT Labs’ capital structure and evaluate strategic alternatives. Upcoming hearings will determine whether the network’s operations continue or if technological assets are liquidated.
