BlockFi
BankruptLending · born 2017 · ✝ 2022
Crypto interest accounts, bailed out then buried by FTX.
A regulated-leaning crypto lender offering interest accounts. Exposure to 3AC and a bailout deal with FTX left it fatally entangled.
- Peak
- $3B valuation
- Cause
- Bankrupt
- Year of death
- 2022
☠️ Cause of death
Losses from 3AC's default plus reliance on an FTX credit line. When FTX fell, BlockFi followed it into bankruptcy.
📓 Lessons left behind
- —Your rescuer can be your executioner.
- —Concentrated counterparty exposure is existential.
- —Regulatory ambition doesn't offset balance-sheet risk.
🌱 The idea that survived
Segregated, regulated yield products
Tokenized T-bills and regulated yield (Ondo, and licensed custodians) deliver yield without opaque counterparty webs.
#lending#contagion#counterparty