Movement Labs Bankruptcy: The $MOVE Scandal, Chapter 11, and Fallout The Movement Labs bankruptcy now has a court date attached to it. MVMT Labs, Inc., the company behind the Movement blockch
The Movement Labs bankruptcy now has a court date attached to it. MVMT Labs, Inc., the company behind the Movement blockchain, filed for Chapter 11 bankruptcy on July 15, 2026, in Delaware. The company raised $141.4 million from investors, yet daily fees on its own chain fell as low as $1 in the past 24 hours.
Source: PacerMonitor Official
This Movement blockchain collapse adds to a growing list of crypto bankruptcy news this year. A project that once drew Polychain and other big names into its funding rounds now sits in a courtroom, sorting out debts instead of shipping upgrades.
Movement built its blockchain using the Move programming language, the same language behind Aptos and Sui. The project pulled together $141.4 million across several rounds, including a Series A led by Polychain.
That kind of money should buy years of breathing room.
The daily numbers tell a different story. DeFiLlama data shows daily app revenue on the Movement chain has dropped significantly.
Total raised: $141.4M across multiple rounds
Daily app revenue: stayed below $800 every single day since November last year
Chain fees: sat in single digits for months, and hit just $1 in the past 24 hours
Total value locked: around $133 million
Here, $133M TVL money most likely belongs to point farmers chasing rewards, not everyday users. A chain pulling in $1 a day in fees, after raising $141.4M, was never going to last on its own.
Chapter 11 is a form of bankruptcy that lets a company keep operating while it works out a plan to pay back what it owes. It does not force the business to shut down right away. Courts give the company time to restructure debts.
The MVMT Labs Chapter 11 filing lists assets between $100,001 and $500,000 against liabilities between $1 million and $10 million. Court records show 200 to 999 creditors, including Anchorage Digital and state revenue departments.
The trouble started in December 2024, right after Movement launched its $MOVE token. The company signed a market-making deal that let roughly 66 million tokens hit the open market soon after the Binance listing.
That sudden flood of supply crashed the price and erased billions of dollars in value within days.
Co-founder Rushi Manche holds the largest unsecured claim in the case, at about $1.6M, and he still keeps a large equity stake. His name has been tied to the $MOVE platform's troubles since 2024.
Filing date: July 15, 2026, in Delaware
Filing type: Chapter 11, Subchapter V (built for small businesses)
Assets listed: $100,001 to $500,000
Liabilities listed: $1 million to $10 million
Creditors: 200 to 999, including Anchorage Digital and state tax departments
Claims deadline: September 14, 2026
Restructuring plan due: October 13, 2026
Creditors now have until September 14, 2026, to file claims, and the court expects a Movement Labs restructuring plan by October 13, 2026.
The MOVE token crash 2026 has hit holders hard. The token's fully diluted valuation sits near $107 million now, a drop of over 99% from its all-time high. Anyone who bought near the top has watched most of that value disappear.
MOVE token price today: $0.01073
Market cap: $44.78 million
24-hour volume: $8.7 million, up 5.95%
Fully diluted valuation (FDV): $107.47 million
Total supply: 10 billion MOVE
Circulating supply: 4.16 billion MOVE
The all-time low came just two days ago, on July 20, 2026, at $0.01044, and the price has climbed 2.83% since then, as per CoinMarketCap.
A bankruptcy filing from the developer doesn't automatically kill the token, since the chain can keep running without MVMT Labs, but it chips away at trust fast.
Holders face steep losses, with MOVE down more than 99% from its all-time high
A developer bankruptcy does not automatically shut down the blockchain, since Move Industries can keep the network running
Existing balances and smart contracts should keep working in the short term
Confidence and liquidity could keep shrinking as the court case moves forward
Any future price recovery likely depends on real usage, not just a new name on the door
Company's Next Plan: What Move Industries Will Do Going Forward Now
Move Industries, a separate company led by CEO Torab Torabi, took over core development back in 2025. It has shifted the project away from competing with other Ethereum layer-2 chains and toward cross-border payments and stablecoin settlement for emerging markets.
Source: CEO Torab Torabi
Move Industries has stated the Movement Labs bankruptcy filing doesn't touch its own operations. Smart contracts on the chain should keep working in the short term, and existing balances stay intact for now.
Creditors must file claims by September 14, 2026
A restructuring plan is due in court by October 13, 2026
Whether that pivot brings real users remains the open question every holder is left with.
Movement's story lines up with a familiar pattern in crypto: big raises, bold claims, and thin usage once the marketing fades.
The Ethereum L2 failure here isn't about a hack or an exploit; it's about a business that never built enough real demand to match its funding.
What happens next depends on whether Move Industries can turn a stablecoin pivot into actual transaction volume, because a rebrand alone won't pay off a $1.6 million claim or rebuild lost trust.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Crypto markets carry significant risk. Always do your own research before making any investment decisions.
