The crypto lender BlockFi was one of the companies that was involved in the liquidation of venture firm Three Arrows Capital (3AC), according to a recent development.
A few days ago, reports started circulating that $400 million had been liquidated from the venture firm by its lenders and that the firm was facing liquidity issues.
On Thursday, the Financial Times reported that BlockFi “was among the groups that liquidated at least some of 3AC’s positions.”
BlockFi’s chief risk officer, Yuri Mushkin said that the company had held collateral in excess of the size of the loan. BlockFi simply reduced its exposure to 3AC’s positions.
He further said that this is BlockFi’s “best business judgment… with a large client that failed to meet its obligations.” He also mentioned that BlockFi was one of the first companies to take action against the counterparty.
The news was further confirmed by a series of tweets posted by BlockFi’s CEO Zac Prince. He mentions in his tweets that although they cannot comment on the specific counterparties, BlockFi recently exercised its “best business judgment recently with a large client that failed to meet its obligations on an overcollateralized margin loan.”
The company “fully accelerated the loan and fully liquidated or hedged all the associated collateral.”
He further assures users that no client funds were impacted and that the company will continue to function as normal.
