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BlockFi bankruptcy filing triggers a wide range of community reaction

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As crypto lending platform BlockFi filed for bankruptcy, members of the crypto group reacted with blended suggestions as one other platform fell through the present bear market. 

Regardless of BlockFi citing the FTX contagion as the explanation for its chapter submitting, podcaster Matt Odell identified a distinct clarification. Odell wrote that the lending platform went bankrupt as a result of it was lending buyer funds to high-risk merchants who performed with leverage recklessly. “This can be a story as previous as Bitcoin, leverage kills, and trusted third events are safety holes,” he added.

In a tweet, Mario Nawfal highlighted that BlockFi’s chapter submitting was one thing that many members of the group anticipated. In accordance with Nawfal, the chapter submitting marks the tip of an period for the lending and yield-earning platform that was capable of barely dangle on after the Voyager and Celsius debacles.

With many shedding funds through the course of, some pointed their pitchforks to entrepreneur and podcaster Anthony Pompliano who launched them to the lending platform. A Twitter consumer claimed that they misplaced most of their financial savings after listening to Pompliano’s podcast that beneficial BlockFi.

One other group member claimed that they diversified their portfolio by placing some funds in FTX, BlockFi and Bitcoin (BTC) which Pompliano beneficial. They famous that two out of the three have already gone to zero.

ShapeShift founder Erik Voorhees additionally reacted to data popping out that the Securities and Exchanges Fee (SEC) is among the collectors for BlockFi. Voorhees floated the thought of the SEC returning $70 million that they took from BlockFi to be able to assist the customers that they need to be defending.

Associated: Silvergate denies recent FUD, confirms minimal exposure to BlockFi

In the meantime, the crypto lending platform has filed a lawsuit against former FTX CEO Sam Bankman-Fried’s holding firm referred to as Emergent Constancy Applied sciences. BlockFi hopes to get Bankman-Fried’s shares in Robinhood that had been used as collateral earlier this month.