Are you a crypto enthusiast? Well, then this news might jolt you out of your crypto dreams. Apart from the usual volatility, the crypto landscape is for the first time witnessing the failures of massive names in the crypto world.
The dramatically shocking collapse of FTX has severely impacted the industry. And the aftereffects are now emerging one by one, BlockFi’s bankruptcy being the most recent one.
BlockFi was founded to bring the world of cryptocurrencies and traditional finance closer to each other. The pillars of the platform were transparency and efficiency. It offered financial services to the users which would be backed by assets in crypto.
There was a lot of positivity and enthusiasm around this platform. It also secured significant funding from reputed investors like Bain Capital Ventures and Tiger Global. At its peak, BlockFi was managing assets worth $15 Billion!
However, even with these noble intentions, the platform did not manage to remain clean. What spiraled after its peak period has boggled the minds of investors. With the frequent fluctuations in crypto valuations, the platform started to struggle. It became clear after a point that it would not be able to survive without some serious intervention. So BlockFi began seeking help from authorities and stakeholders to restructure and reorganize itself. In this situation, FTX, a major crypto exchange stepped in to help the platform.
When it seemed like everything would work out nicely and smoothly, the major crypto exchange, FTX collapsed to everyone’s surprise. And things have only been going south from there for BlockFi. FTX had offered a rescue deal to BlockFi which increased BlockFi’s exposure quite severely.
This sudden and unexpected move of events has not only shocked the entire crypto industry but has also alerted government agencies and authorities. The public sentiment has also taken a big hit. What is even worse is that BlockFi is not a standalone case.
What is hurting the public and investor sentiment is the trend in this industry. One of the most popular child of the crypto street, Bitcoin itself halved in value by falling from $64,000 sometime back to less than $20,000 in recent times.
Is this an end to something or the beginning of a better future? Everyone including experts has their own theories but all one can do at this point is wait. The jury is out on the future of crypto.