Cred
BankruptLending · $LBA · born 2018 · ✝ 2020
An early crypto lender felled by fraud and bad bets, freezing accounts.
Cred was a crypto lending and yield platform. It filed for bankruptcy in late 2020 after suffering large losses tied to alleged fraud and a defaulting borrower, freezing customer funds.
- Peak
- ~$140M+ liabilities
- Cause
- Bankrupt
- Year of death
- 2020
☠️ Cause of death
Losses from a defaulted loan to an asset manager and alleged internal fraud left it insolvent; it halted transactions and filed Chapter 11.
📓 Lessons left behind
- —Unregulated lenders can lose deposits to single bad borrowers.
- —Weak internal controls invite fraud.
- —Early movers in crypto lending pioneered the risks later repeated.
🌱 The idea that survived
Risk-managed lending
Underscored the need for diversification and underwriting that survivors tried to formalize.
#lending#fraud#bankruptcy