- The cryptocurrency lender has revealed that it has substantial exposure to FTX.
- FTX bought BlockFi in July, when the crypto lending platform was struggling.
The FTX Empire’s demise left many in the cryptocurrency community shocked. The crypto lending platform BlockFi was also impacted by FTX’s collapse. In the middle of the mayhem, BlockFi suspended withdrawals. Users were notified on November 11 that the New Jersey-based exchange will be restricting platform activities. BlockFi recently expressed shock and dismay at the collapse of FTX and Alameda in a letter that was circulated on Twitter.
After the failure of Sam Bankman-Fried’s exchange, BlockFi is allegedly making preparations for bankruptcy, as reported by the WSJ.
Affected Yet Again
In one of its reports, information from sources indicates that the crypto lender is making contingency plans for a possible bankruptcy. The cryptocurrency lender has revealed that it has substantial exposure to Bankman-Fried’s FTX. And it even has plans to lay off part of its staff in preparation for a potential Chapter 11 bankruptcy filing.
It is important to remember that FTX bought BlockFi in July when the crypto lending platform was in the midst of serious financial troubles. A total of $80 million in risk was incurred by the platform due to the collapse of Three Arrows Capital. The corporation first said that it was “fully functional,” despite the fact that FTX had already failed.
However, things seem to be different today, since the collapse of FTX appears to have had a significant impact on the lender. It is now included among the other companies that suffered heavily because of the FTX downfall. Moreover, last week FTX exchange filed for Chapter 11 Bankruptcy.
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