BlockFi Files For Chapter 11 Bankruptcy
BlockFi Bites The Dust
It's crazy how one platform had so much exposure to all of these other platforms. It goes to show you how reliant they where on a single entity and how business 101 or even country management 101 or Investment 101 you don't do that!
BlockFi was a platform that offered up rewards to their credit card users including a host of many other products and services all under one roof. It allowed for trading of a number of tokens in which the company would collect fees from. It also offered up interest to be earned on the crypto you stored with them as well including loans against the crypto you owned.
As of today Nov 28th 2022 BlockFi filed for a chapter
Let me make one thing VERY CLEAR!
There is nothing wrong with crypto and the issues we are seeing are bad actors that made very poor businesses decisions with others money and exposed themselves to more risk and blew up in their faces. These are centralized businesses entities at fault here and not crypto.
Again I'm going to make it perfectly clear if ANY company is offering a higher APR then what is earned through staking rewards on a token it means they are exposing themselves to massive risks. If these companies would have simply held on to the crypto and staked 90% of it while keeping 10% liquid and offered 1% less then the APR being paid on those tokens this issue would not be happening right now. 1% on a billion dollars is plenty of money for any company at 10 million dollars in pure profit for doing nothing more then holding and staking crypto. The issue here is greedy over exposed companies and people.
What Is A Chapter 11 Bankruptcy?
In general it provides the company the ability to reorganize. It proposes a plan for reorganization to keep the businesses alive and pay creditors over time. A chapter 11 also allows the company to seek relief.
What's In The Restructuring Of BlockFi?
Currently we know that it will involve layoffs. What's crazy is myself and others warned massive layoffs would be coming 6 months ago but so many people are so short sighted for the next day ahead that they write these things off. We are now seeing Epic layoffs across the board.
The combination of low liquidity and a complete blowup of companies that were piggy backing off of one another is now showing it's ugly head. Again this is a CLEAR issue with massive evidence of corporate mismanagement and not crypto itself.
For the most part markets didn't react to heavily to this news. It seems like most of this is already priced in before hand. We all pretty much expected BlockFi to file even though they tried to save face for a few weeks. My hopes are through this all people get a wake up call and start to manage their own wallets and funds. There's so many possibilities to stake from your own wallet now and earn full interest instead of lending that over to someone else which has higher risks and less rewards in my opinion. For me this is the building blocks for the next phase of Crypto and it's most likely going to be a quick change.
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