BlockFi was a cryptocurrency lending platform founded in 2017 that offered interest-bearing accounts, loans, and other financial services related to digital assets. The company's main product was the BlockFi Interest Account (BIA), which allowed users to deposit cryptocurrencies like Bitcoin and Ethereum and earn interest, with rates reaching up to 9.5% on stablecoins at one point. BlockFi generated revenue by lending out customer deposits to institutional borrowers and investing in various crypto-related financial products. The company also offered a crypto-backed credit card and trading services.
In February 2022, BlockFi reached a USD 100 million settlement with the US Securities and Exchange Commission (SEC) and 32 states over allegations that its interest accounts were unregistered securities. As part of the settlement, BlockFi agreed to stop offering new BIAs to US customers and seek proper registration for its products. The company continued operations but faced challenges as the crypto market declined throughout 2022. In November 2022, following the collapse of crypto exchange FTX, BlockFi halted customer withdrawals and filed for Chapter 11 bankruptcy protection. At the time of its bankruptcy filing, BlockFi owed money to over 100,000 creditors and held USD 256.5 million in cash on hand.
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