Movement Labs Files for Chapter 11 Bankruptcy; Ousted Co-Founder Claims $1.6M Debt

According to The Block, Movement Labs (MVMT), the core developer of Ethereum Layer 2 network Movement Network, filed for Chapter 11 bankruptcy protection in early July. Court filings from July 15 show assets between $100,000 and $500,000, with liabilities reaching up to $10 million and 299 listed creditors. The largest unsecured claim of over $1.6 million is held by ousted co-founder Rushikesh Manche, who retains 34.25% equity.

The bankruptcy follows the December 2024 MOVE token crisis triggered by market maker liquidations. Internal investigations led to Manche's removal, after which core development operations shifted to Move Industries. The company had previously raised $38 million in Series A funding led by Polychain Capital.