Industry | Cryptocurrency |
---|---|
Founded | 2017 |
Founders |
|
Fate | Filed for Chapter 11 bankruptcy protection in November 2022 |
Headquarters | Jersey City, New Jersey, U.S. |
Website | blockfi |
BlockFi was a digital asset lender founded by Zac Prince and Flori Marquez in 2017. [1] It was based in Jersey City, New Jersey. [2] [3] It was once valued at $3 billion. [4]
In July 2022, it was announced that the cryptocurrency exchange FTX made a deal with an option to buy BlockFi for up to $240 million. The deal included a $400 million credit facility for the company. [5] [6]
In November 2022, after the declaration of bankruptcy by FTX, the company halted withdrawals on its platform. [7] The firm disclosed "significant exposure" to FTX on November 14. The next day, the Wall Street Journal reported that BlockFi would likely file for bankruptcy, which was reaffirmed by reports compiled by Bloomberg News. [8] [9] [10] On November 28, BlockFi confirmed the reports and officially filed for Chapter 11 bankruptcy protection [11] with more than 100,000 creditors, according to filings. [12] [13] In March 2023, following the collapse of Silicon Valley Bank, the U.S. Trustee watchdog overseeing BlockFi's bankruptcy revealed that BlockFi had around $227 million in uninsured funds at the bank. [14] BlockFi's CEO Zack Prince testified in the trial of Sam Bankman-Fried, and stated that he thought BlockFi would not have gone bankrupt if it had not lost access to its funds in the FTX collapse. [15] In October 2023, BlockFi emerged from Chapter 11 bankruptcy and announced that it would begin winding down all of its remaining operations and assets post-bankruptcy. Over the next few months, crypto assets will be returned to customers at BlockFi until all assets are fully liquidated. BlockFi will continue to pursue payments from the bankruptcies of FTX and Three Arrows Capital during the liquidation process. [16]
A cryptocurrency exchange, or a digital currency exchange (DCE), is a business that allows customers to trade cryptocurrencies or digital currencies for other assets, such as conventional fiat money or other digital currencies. Exchanges may accept credit card payments, wire transfers or other forms of payment in exchange for digital currencies or cryptocurrencies. A cryptocurrency exchange can be a market maker that typically takes the bid–ask spreads as a transaction commission for its service or, as a matching platform, simply charges fees.
CoinDesk is a news site specializing in bitcoin and digital currencies. Founded by Shakil Khan, the firm also provides guides to bitcoin for those new to digital currencies.
BitGo, Inc. is a digital asset trust company and security company, headquartered in Palo Alto, California. It was founded in 2013 by Mike Belshe and Ben Davenport. Galaxy Digital announced its acquisition of BitGo in 2021 for $1.2 billion, although this acquisition was announced to have been canceled in 2022 after the crypto downturn, with BitGo continuing as an independent company.
Digital Currency Group (DCG) is a venture capital company focusing on the digital currency market. It is located in Stamford, Connecticut. The company has the subsidiaries Foundry, Genesis, Grayscale Investments, and Luno. It also formerly owned CoinDesk.
Alan Joseph Bankman is an American legal scholar and psychologist. He is the Ralph M. Parsons Professor of Law and Business at Stanford Law School. He was also employed at FTX, the cryptocurrency company founded by his son, Sam Bankman-Fried, who is an MIT graduate, entrepreneur, and convicted felon. His tenure at FTX lasted until the company's bankruptcy and subsequent collapse in 2022.
A cryptocurrency bubble is a phenomenon where the market increasingly considers the going price of cryptocurrency assets to be inflated against their hypothetical value. The history of cryptocurrency has been marked by several speculative bubbles.
Binance Holdings Ltd., branded Binance, is a global company that operates the largest cryptocurrency exchange in terms of daily trading volume of cryptocurrencies. Binance was founded in 2017 by Changpeng Zhao, a developer who had previously created high-frequency trading software. Binance was initially based in China, then moved to Japan shortly before the Chinese government restricted cryptocurrency companies. Binance subsequently left Japan for Malta and currently has no official company headquarters.
Decentralized finance offers financial instruments without relying on intermediaries such as brokerages, exchanges, or banks by using smart contracts on a blockchain, mainly Ethereum. DeFi platforms allow people to lend or borrow funds from others, speculate on price movements on assets using derivatives, trade cryptocurrencies, insure against risks, and earn interest in savings-like accounts. DeFi uses a layered architecture and highly composable building blocks. Some applications promote high-interest rates but are subject to high risk. Coding errors and hacks have been common in DeFi.
Samuel Benjamin Bankman-Fried, or SBF, is an American entrepreneur who was convicted of fraud and related crimes in November 2023. Bankman-Fried founded the FTX cryptocurrency exchange and was celebrated as a "poster boy" for crypto. At the peak of his success, he was ranked the 41st-richest American in the Forbes 400.
FTX Trading Ltd., commonly known as FTX, is a bankrupt company that formerly operated a fraud-ridden cryptocurrency exchange and crypto hedge fund. The exchange was founded in 2019 by Sam Bankman-Fried and Gary Wang. At its peak in July 2021, the company had over one million users and was the third-largest cryptocurrency exchange by volume. FTX is incorporated in Antigua and Barbuda and headquartered in the Bahamas. FTX is closely associated with FTX.US, a separate exchange available to US residents.
Crypto.com is a cryptocurrency exchange company based in Singapore. As of June 2023, the company reportedly had 80 million customers and 4,000 employees. The exchange issues its own exchange token named Cronos (CRO).
Celsius Network LLC is a cryptocurrency company. Headquartered in Hoboken, New Jersey, Celsius maintained offices in four countries and operated globally. Users could deposit a range of cryptocurrency digital assets, including Bitcoin and Ethereum, into a Celsius wallet to earn a percentage yield, and could take out loans by pledging their cryptocurrencies as security. As of May 2022, the company had lent out $8 billion to clients and had almost $12 billion in assets under management.
Alameda Research was a cryptocurrency trading firm, co-founded in September 2017 by Sam Bankman-Fried and Tara Mac Aulay.
Three Arrows Capital was a Singapore-based cryptocurrency hedge fund which was ordered to liquidate on 27 June 2022 by a court in the British Virgin Islands. It was founded in 2012 by Kyle Davies and Su Zhu. The company borrowed billions of dollars to fund its trading, and according to July 2022 bankruptcy filings, faces $3.5 billion in creditors' claims. The fund appears to have lost in excess of $3 billion over 2021 and 2022, making its collapse one of the largest hedge-fund trading losses of all time.
Caroline Ellison is an American former business executive and quantitative trader who served as the CEO of Alameda Research, the trading firm affiliated with the cryptocurrency exchange FTX and founded by FTX founder Sam Bankman-Fried. In 2022, she pleaded guilty to fraud, money laundering, and conspiracy charges related to her role at Alameda Research.
Voyager Digital was a cryptocurrency brokerage company.
The bankruptcy of FTX, a Bahamas-based cryptocurrency exchange, began in November 2022. The collapse of FTX, caused by a spike in customer withdrawals that exposed an $8 billion hole in FTX’s accounts, served as the impetus for its bankruptcy. Prior to its collapse, FTX was the third-largest cryptocurrency exchange by volume and had over one million users.
Genesis is a cryptocurrency brokerage for institutional investors. It is a subsidiary of Digital Currency Group (DCG).
United States of America v. Samuel Bankman-Fried was a 2023 federal criminal trial in the United States District Court for the Southern District of New York. Financial entrepreneur Sam Bankman-Fried, commonly known as SBF, was convicted on seven charges of fraud and conspiracy following the collapse of his cryptocurrency exchange FTX in November 2022.
Erik Tristan Voorhees is an American-Panamanian cryptocurrency entrepreneur implicated in facilitating money laundering through his cryptocurrency exchange ShapeShift. ShapeShift, unlike many exchanges, did not require user identification, allowing for anonymous transactions. He also co-founded Satoshi Dice and was the Director of Marketing at BitInstant. He has been referred to as a crypto-libertarian and has advocated for "the separation of money and state".