BlockFi, a centralized entity that provides USD loans on crypto collateralization, has announced they’re pausing withdrawals.
The company said they are “shocked and dismayed” by the events unfolding at FTX and Alameda. BlockFi is thought to have had exposure with a $400 million line of credit from FTX.US.
It is currently unclear whether FTX US will keep running, with the exchange announcing that “trading may be halted in a few days.”
“Until there is further clarity, we are limiting platform activity, including pausing client withdrawals,” BlockFi said.
BlockFi had 500,000 customers last year when it was valued at $4 billion. There’s suggestions it had $14 billion of assets in 2021, but it was affected by the collapse of Three Arrows Capital this summer with most clients probably leaving at the time.
No response was received to requests for confirmation regarding their current client numbers and assets.
Genesis trading, which focuses on institutional investors, revealed they have $175 million frozen at FTX, but otherwise are unaffected.
Making BlockFi the first, and so far the only crypto company to seemingly be completely affected by the bankruptcy of FTX and Alameda.