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BlockFi files for bankruptcy as FTX fallout spreads

cnbc.com

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Re: BlockFi files for bankruptcy as FTX fallout spreads

#251

Post by onlyrealcuzzo »

dvt wrote: post #189
soupsranjan wrote: post #98

Earlier quoted context omitted.

Coinbase is a publicly listed company, with all its assets & liabilities shared in quarterly investor updates. They store all customers assets 1:1 (ie does not re-hypothecate any of customer assets)

Enron was also public, so was Lehman Brothers. The idea that public companies can't game their numbers or commit fraud is provably false. Why anyone would have large sums of crypto (5 or 6 figures+) on an exchange is beyond me.

Did Lehman commit fraud?

My understanding is no.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#252

Post by SilasX »

paulgb wrote: post #2

> At the start of the year, there were three big North American retail crypto lenders. Now all three are bankrupt. https://twitter.com/kadhim/status/1597250428378705921

Huh? It looks like it was saying the three are Celsius, Voyager, and BlockFi, but it’s missing a much larger one, Genesis. Although that maybe be going bankrupt to if it can’t get support from its parent company DCG.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#253

Post by woah »

christiangenco wrote: post #235

My wife and I had about 10% of our life savings in BlockFi. This is a pretty big blow for us, especially while gearing up to start a family. It's easily in the top 5 worst things to happen to me in my life. Is there any hope of individual creditors getting any of their money back? I'm unfamiliar with how bankruptcy works.

Can I ask why? If you wanted to put money into crypto, why didn't you use a blockchain where you could verify your holdings and nobody could take them from you? BlockFi was just an incredibly shitty bank.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#254

Post by squokko »

propter_hoc wrote: post #16

Somehow these guys peaked at about 900 employees, according to linkedin ( https://www.linkedin.com/company/blockfi ) They've raised about a billion dollars of VC - https://www.crunchbase.com/organization/blockfi-inc/investor... (note, CB lists $1.4b, of which 400M is debt from FTX, which I imagine they never got) Unbelievable the amount of destruction of value here... it's just total carnage.

Let's be clear who really destroyed the value - it's the people who took money from pension funds saying they'd invest in cutting edge technology and instead put it into computer meme money startups

Re: BlockFi files for bankruptcy as FTX fallout spreads

#255

Post by bloodyplonker22 »

dehrmann wrote: post #117
ilamont wrote: post #80

Earlier quoted context omitted.

There are LPs behind a lot of these incompetent VCs dumping money into in crypto, including public workers' pension funds.

My hope is most of the crypto investing was isolated to crypto funds, though I still lost some respect for VCs for even playing the crypto game.

I regret to inform you that it was not isolated to "crypto funds". A lot of VCs mish-mashed them together with their other investments and slapped a Cathy Wood style name on it like "future innovation fund". VCs are mostly just salespeople, and so are founders. VCs sell to organizations such as pension funds, and founders sell to VCs. Most VCs lose money, especially in an environment full of froth, and most VCs don't know what they are really doing. From what I have observed, a lot of laypeople have a ton of respect when they hear the word "VC".

Re: BlockFi files for bankruptcy as FTX fallout spreads

#256

Post by andirk »

largepeepee wrote: post #52
skrebbel wrote: post #27

Earlier quoted context omitted.

I’m not convinced there’s any destruction of value when the entire value proposition is a lie. When I tell you my lemonade stand is worth a billion, and you believe it for a while, and then you realize it isn’t really, no value was destroyed.

There is value, in that a generation of moderately wealthy idiots got convinced that monkey pictures are worth something. Like a cult brainwashing, they have attached their identities to those worthless pictures and now are trapped in greedy stupidity.

NFTs are collectors items. It's as stupid as collecting anything, including fine art, photography, baseball cards, rocks. I'll admit it seems more strange because it's uninteresting, but claiming collecting is idiotic is pretty short-sighted.

No, I don't collect that crap :)

Re: BlockFi files for bankruptcy as FTX fallout spreads

#257

Post by woah »

sdiacom wrote: post #6
simple-thoughts wrote: post #3

With projects like blockfi, users get all the disadvantages of the centralized traditional financial system without any of the regulatory protections that have built up over centuries. Terrible for the people with assets in blockfi but extremely predictable. The point of defi is that you can use financial services without a centralized counterparty. People who can’t handle their own keys should be using traditional b…

Sure, but you can't use DeFi to trade fiat for crypto. You can use DeFi to trade crypto for crypto, or for crypto that pretends to be fiat. Saying "centralised exchanges bad, DeFi good" misses the point that the main use case of centralised exchanges is not covered by DeFi.

You can, using stablecoins like USDC. These also involve counterparty risk, but they are extremely simple to audit and regulate.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#258

Post by twiddling »

woodruffw wrote: post #240
christiangenco wrote: post #235

My wife and I had about 10% of our life savings in BlockFi. This is a pretty big blow for us, especially while gearing up to start a family. It's easily in the top 5 worst things to happen to me in my life. Is there any hope of individual creditors getting any of their money back? I'm unfamiliar with how bankruptcy works.

I'm sorry for your hardship. My understanding (which is not a professional or legal opinion) is that individual creditors probably come near last in these kinds of bankruptcy proceedings. It's possible that after a prolonged settlement process you may receive some of your money back, but that's not an outcome that I would place substantial faith in. I say this without an ounce of judgement, explicit or implied: can y…

I would build on this and have a frank discussion with your partner about risk tolerance and long term goals around your portfolio. A single exchange failure should not expose you to this much risk.

Re: BlockFi files for bankruptcy as FTX fallout spreads

#259

Post by twiddling »

coldpie wrote: post #12
postalrat wrote: post #7

Earlier quoted context omitted.

What's the cryptocurrency endgame? Everyone has keys in cold storage waiting for the day we have the mathematics that destroys them?

> What's the cryptocurrency endgame? To not be the one stuck holding the bag.

The Greater Fool theory of investing
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