Amidst The Bear Market, BlockFi Claims To Windup All Its GBTC Position! GBTC Drops By 5%

The post Amidst The Bear Market, BlockFi Claims To Windup All Its GBTC Position! GBTC Drops By 5% appeared first on Coinpedia - Fintech & Cryptocurreny News Media| Crypto Guide

Since Terra (LUNC) crashed in May 2022, the crypto lenders have been striving to cope with the losses and manage the liquidity issues.

Yesterday, July 12, BlockFi, a crypto lender, claimed that Grayscale’s GBTC shares will no longer be accepted as shares.

This news had its own repercussions, as the GBTC stocks (OTCMKTS: GBTC) were pulled down by 5% yesterday, closing the day at $12.21. While Bitcoin and other major cryptocurrencies are trying their best to get into the recovery phase, so does the GBTC. The Grayscale Bitcoin Trust (GBTC) price has bottomed nearly 65% to date.

As BlockcFi discloses the news, it points towards the vulnerability of the crypto lending platforms along with the ill effect of the companies that are bankrupt. This is because Grayscale was affected by Three Arrow Capital’s insolvency as it held more than 5% of GBTC stocks.

On the other hand, BlockFi has incurred a loss of $80 million due to its debt with Three Arrows. It’s just not this, BlockFi CEO Zac Prince also confirmed that the company will also be part of 3AC’s ongoing bankruptcy case.

BlockFi To Wind Up All GBTC Soon

Yesterday, July 12, the company’s CEO Zac Price, replying to the chief strategy officer at Coinsahres, Meltem Demirors’s comments regarding the GBTC position, tweeted that BlockFi doesn’t hold any GBTC and a few loans with GBTC that are held as collateral will also be winding soon.

On the other hand, BlockFi had also signed an agreement with FTX US to find a solution for their increasing liquidity. The agreement said that FTX US will be offering $400 million credit in exchange for acquiring BlockFi for $240 million. However, further updates are yet to be known.