BlockFi Had a Private Connection Worth $1,200,000,000 With FTX and Alameda

According to a recent investigation, BlockFi, a bankrupt cryptocurrency lender, has a greater financial stake in Sam Bankman-FTX Fried's and Alameda Research than previously thought. BlockFi's attorneys claimed that the company has $671 million in loans to Alameda and $355 million in cryptocurrency assets on the FTX exchange, for a total of just over $1 billion, during the initial bankruptcy court for the troubled company in November.

BlockFi's exposure to Bankman-defunct Fried's enterprise is reportedly valued at $1.2 billion, according to a recent CNBC story. The article states that as of January 14th, the company had $415.9 million in assets with FTX and a $831.3 million loan to Alameda, citing an unedited BlockFi filing. The document was prepared for presentation by M3 Partners, a consultant to BlockFi's creditor committee. The report was intended to have some information redacted, but by mistake the file was downloaded and accessible to the general public without the suppression.

Additionally, according to the financial presentation, BlockFi has unadjusted assets worth almost $2.7 billion, which suggests that nearly half of the assets of the troubled cryptocurrency lender are linked to FTX and Alameda.

A BlockFi spokesman stated the company encourages openness after the report was published.

Exposure to Three Arrows Capital, a cryptocurrency investment company that sought bankruptcy proceedings in July, sparked BlockFi's demise. Through a $400 million revolving credit line, FTX had set up a rescue package for BlockFi, but that arrangement collapsed when FTX experienced its own liquidity crisis and quickly went bankrupt.

The value of the Alameda loan receivable and the property linked to FTX have both been lowered to zero according to the most recent BlockFi financials provided. BlockFi has resources totaling slightly under $1.3 billion after all modifications, of which only $668.8 million is categorized as “Liquid To Be Distributed.”

The combined compensation for the remaining workers will total $11.9 million per year. Three employees who specialize in delivering results are among the remaining team members, and they will each receive an annual wage of more than $134,000.

According to the presentation, the average salary of the five workers who are still working for the business is $822,834, demonstrating that BlockFi's retention “plans are larger than comparable crypto cases.”

BlockFi provides a cryptocurrency trading exchange as well as a custodial solution that pays interest. The struggling business, which previously claimed to have “substantial exposure” to FTX, said Monday that it had more than 100,000 creditors and has financial statements between $1 billion and $10 billion.

Crypto investors are learning a tough lesson about their safeguards compared to investors in more traditional assets thanks to the current FTX crisis and the bankruptcies of lenders Celsius Network and Voyager Digital earlier this year. Legal actions that would probably last years are currently deciding what will happen to their money.

As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!

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