WILMINGTON, DE — Echo Base has formed a restructuring and crisis-advisory business aimed at digital-asset companies facing liquidity problems, regulatory action and other disruptions, expanding the privately funded firm beyond investing and financing into an area it argues remains underserved after years of cryptocurrency failures.
The new unit, Echo Base Restructuring, or EBRx, will advise founders, major shareholders and boards before and after events that threaten otherwise viable businesses.
Its mandate includes liquidity shortfalls, funding gaps, covenant and maturity problems, failed financings, counterparty defaults, suspended withdrawals and frozen or seized assets. The unit will also handle regulatory and enforcement actions, license losses, forced jurisdictional exits, litigation, control contests and shareholder disputes.
Echo Base is positioning EBRx for situations in which an operating business has been destabilized by a financial problem, dispute or external event rather than companies whose underlying economics have failed.
The expansion reflects the firm’s view that the digital-asset sector lacks the restructuring infrastructure common in more established markets despite a decade marked by insolvencies, shutdowns and enforcement actions.
Echo Base expects to typically serve as lead adviser to a chief executive or board during a crisis, setting restructuring strategy and leading distressed financing and M&A discussions while management continues operating the business.
The role can be public or confidential. EBRx may also selectively accept officer or director appointments and work alongside legal counsel and restructuring financial advisers.
“In every restructuring there is less value than there are claims against it, and how that gets divided is usually settled in the first two weeks, before anyone has run the numbers,” Echo Base Chief Executive Officer Roshan Dharia said.
Dharia argued that decisions made immediately after a crisis — including suspending withdrawals, communicating publicly or paying particular claimants — can alter a company’s negotiating position before formal restructuring advisers are retained.
“A company suspends withdrawals, puts out a statement, pays one claimant ahead of another, and by the time advisors arrive the leverage is gone and the record is working against them,” he said.
EBRx will be staffed by the same investment, operating and restructuring team that handles Echo Base’s transactions. The firm has participated in distressed situations as a creditor, acquirer and counterparty and has experience with negotiations involving multiple jurisdictions, litigation and competing creditor groups.
Echo Base also plans to use its investment capabilities selectively to provide capital in restructuring situations, combining its role as a principal investor with advisory work through EBRx.
A separate operation, Echo Base Recovery, can take over asset administration when a company stops operating. Its responsibilities include custody control, reconciliation, claims administration and wind-down activities.
The restructuring unit broadens Echo Base’s business as financial stress, counterparty disputes and regulatory intervention continue to create demand for specialized crisis management across digital-asset markets.
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