Home » Business » The cryptocurrency crisis is getting worse.. A new platform files for bankruptcy

The cryptocurrency crisis is getting worse.. A new platform files for bankruptcy

The cryptocurrency market is facing a mass flight that has been going on since the stock market crash (FTP extension) weeks ago, which deepened the entire market crisis and continued the wave of decline of various prices of cryptocurrencies traded in the world.

In the latest episode of the industry crisis, cryptocurrency lending platform BlockFi filed for bankruptcy as it sought U.S. Chapter 11 protection on Monday morning, becoming the latest crypto company to experience a rapid downturn. collapse after the failure of the FTX exchange, which will exacerbate the problems of the cryptocurrency globally.

Started in 2017, BlockFi was one of many crypto lending and lending companies, where customers could use cryptocurrencies as collateral.

Western reports, seen by Al Arabiya Net, claim that the same behavior of this platform led to the demise of two rival companies (Voyager Digital) and (Celsius Network) last summer, as cryptocurrency prices fell.

BlockFi had similar financial woes over the summer, but received an emergency bailout in the form of a $250 million credit line from exchange FTX, but the latter recently collapsed, which appears to have led to the bankruptcy of BlockFi.

“With FTX collapsing, BlockFi’s management team and board immediately took action to protect both customers and the company,” said Mark Renzi of the Berkeley Research Group.

BlockFi will not provide further details about the events leading up to its failure beyond what is already publicly available.

BlockFi previously halted customer withdrawals on Nov. 10 and after a four-day hiatus, announced it had appointed Berkeley Research as a financial restructuring advisor, citing “significant exposure to FTX and its associated corporate entities.”

BlockFi’s bankruptcy adds to the agony of cryptocurrency investors still reeling from the collapse of FTX earlier this month.

Genesis Lending, the largest cryptocurrency lending firm, is facing similar financial problems after suspending customer withdrawals two weeks ago.

In a Chapter 11 petition, BlockFi revealed that its three biggest lender claims are $729 million from Ankura Trust, a distressed loan management company, and a $275 million loan from West Realm Shires, a holding company. the United States.

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