In an official update sent to clients on Nov. 14, BlockFi admitted it had a “significant exposure” to FTX and its affiliates, but insisted it had “the liquidity to cover all options.” check”. The news came as a bit of a surprise as BlockFi founder and Chief Operating Officer Flori Marquez assured users in a November 8th Twitter thread that all BlockFi products are “fully functional” as it has a credit line of 400 million Dollars from FTX got USA, which is a separate entity from FTX, the global entity hit by the liquidity crisis.
Related: FTX-owned crypto exchange Liquid halts all withdrawals
In the coming weeks, it should come as no surprise to learn that many more companies have been impacted by FTX’s collapse. On Nov. 15, crypto lending platform SALT also announced that it was suspending withdrawals and deposits on its platform “effective immediately” as “the collapse of FTX has impacted our business,” according to an email that was sent to their customers.
In an email, captured in a tweet that circulated online, the company said: “Until we are able to determine the extent of this impact based on specific details that we believe are factually accurate, we immediately stopped deposits and withdrawals on the Salt platform.”
However, Shawn Owen, SALT’s CEO, denied claims that this was a signal that his company was “going bust”, stating: “We did not release this as an announcement of bust. We’re taking a break to address and confirm FTX’s failure[e] of our counterparties carry additional risks, so we must proceed with the utmost caution and make every effort not to go broke. More info coming soon.”
We did not release this as a statement of bankruptcy. We pause to deal with the FTX default and to confirm that none of our counterparties have additional risks, allowing us to proceed with the utmost caution and make every effort not to go bust. More information coming soon.
— Shawn Owen (@Shawn_OwenJ) November 15, 2022
On Nov. 15, Cointelegraph reported that Japanese cryptocurrency exchange Liquid had halted withdrawals amid the ongoing crisis amid centralized crypto exchanges. FTX-owned crypto exchange Liquid officially took Twitter on board announce a suspension of fiat and crypto withdrawals on its Liquid Global platform.
Just a day after it denied that the majority of its assets were held on FTX prior to the stock market collapse, BlockFi is reportedly preparing to file for bankruptcy, according to a source familiar with the matter, the WSJ reported.
Fiat and crypto withdrawals have been suspended at Liquid Global in accordance with the requirements of the United States’ voluntary Chapter 11 filing.
Until further notice, we recommend not depositing FIAT or Crypto
We will provide updates as they become available.
— Liquid Global Official (@Liquid_Global) November 15, 2022
Cointelegraph reached out to BlockFi and Salt for comment, but did not receive a response in time for publication.