BlockFi Regulates Platform Activity

https://thecryptostar.co/?p=18122

BlockFi Regulates Platform Activity, Stopping Customer Withdrawals Among Other Things

Although we hope to communicate often, we expect it to be less frequent than what our customers and other stakeholders are used to.

Following the collapse of FTX, cryptocurrency lender BlockFi has stopped customer withdrawals on its platform as part of a larger restriction on platform activities.

The business claimed in a tweet on Nov. 11 that it was unable to conduct business as usual due to “a lack of clarification on the status of FTX.com, FTX US, and Alameda.”

As a result, it added, it has curtailed platform activity until further information about the evolving situation is available.

Additionally, the company has asked that customers refrain from making deposits to Interest Accounts or BlockFi wallets at this time.

It happens just a few days after BlockFi founder and COO Flori Marquez assured users on Twitter that all of the company’s products were fully operational on November 8 because they had a $400 million line of credit from FTX US, an independent company from the one that was experiencing a liquidity crisis.

BlockFi “shall remain an independent business until at least July 2023,” according to Marquez, is most likely referring to the agreement with FTX US that gave them access to the line of credit and gave FTX US the opportunity to buy BlockFi for a variable price up to $240 million.

However, recent events from FTX US have sparked concerns about the financial impact the fallout from FTX has had on its US subsidiary. A banner at the top of the FTX US website stated that “trade may be discontinued on FTX US in a few days.”

The rapid shift in verbiage emanating from BlockFi, which had just 12 hours earlier guaranteed consumers that “all crypto transactions, including withdrawals, will continue as usual,” has not gone down well with the cryptocurrency community.

The CEO of HouseHack and YouTuber with 1.85 million followers Kevin Paffrath saw a similar about-face in Sam Bankman-public Fried’s remarks prior to the FTX scandal.