Amid 3AC's Margin Calls, BlockFi Says It Has Liquidated A "Large Client"

BlockFi Took The First Action

BlockFi, a cryptocurrency lender, said on Thursday that it has liquidated a "major client" and taken "decisive" risk mitigation measures in compliance with its contracts with specific counterparties. While the lender has not named the client, it comes amid claims that Three Arrows Capital (3AC), a crypto hedge fund and venture capital firm, was the counterparty involved. BlockFi CEO Zac Prince tweeted late Thursday,

A shaky market is causing issues for some of the industry's most well-known brands, such as interest yield-earning platform Celsius, which has restricted user withdrawals and transfers due to harsh market conditions. Some crypto companies cannot pay their obligations to lenders due to a liquidity issue.

BlockFi Took The First Action

BlockFi was one of the first to take action with the unnamed counterparty. Therefore, client funds are unaffected, Prince stated in a follow-up tweet. By publication, Blockworks has not received a reaction from BlockFi.

Following a $400 million liquidation by top-tier lenders, embattled firm 3AC is said to be approaching insolvency. According to reports, 3AC had limited contact with the counterparties concerned. Blockworks contacted 3AC but received no response. Some speculate that 3AC dumped large amounts of stETH at a discount to finance its debts. Due to its involvement in the now-defunct Terra ecosystem and illiquid investment in staked ether (stETH) via the Lido Finance protocol. Some speculated that the firm was underwater due to its involvement in the now-defunct Terra ecosystem and illiquid investment in staked ether (stETH) via the Lido Finance protocol.

Disclaimer: The views and opinions expressed in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

BlockFi Zac Prince 3AC

Amid 3AC's Margin Calls, BlockFi Says It Has Liquidated A "Large Client"

Usha Yadav

Usha is a diehard crypto enthusiast and has been actively writing on different facets of the blockchain and crypto world. She has authored many research articles on cryptocurrency and aims to provide informational and quality content to readers. She firmly believes that crypto has a great potential to redefine the world of finance and blockchain.