While the FTX mess gets messier, one of crypto’s major lending platforms, BlockFi, has announced it can no longer conduct business as normal and will be limiting its services henceforth.

What a week. Can it just be over yet? While we’d love nothing more for today’s crypto bounce to sustain and for it to be up only from here amid Fed pivoting, stupendous mass adoption and SEC boss Gary Gensler quitting to become an MIT blockchain lecturer once more, we have to be a bit realistic.

Although… regarding Gensler, actually… this tweet from the largely crypto-supportive Republican Congressman Tom Emmer is a bit interesting:

We digress.

 

‘We found out about it on Twitter’

Back to BlockFi… Is this a sign of things to come? That is, the beginnings of Crypto Contgaion 2.0 (the original was sparked by the Terra LUNA blowup in May)?

A major rival to the Contagion 1 combusted Celsius and Voyager crypto-lending platforms, and a company worth US$3 billion dollars at its peak, New Jersey-based BlockFi made an announcement no one particularly wanted to hear today.

The firm wrote that the “lack of clarity” around the FTX situation means it will now pause client withdrawals. It also advised that clients shouldn’t deposit any funds to the platform’s wallet or interest accounts.

“We are shocked and dismayed by the news regarding FTX and Alameda. We, like the rest of the world, found out about this situation through Twitter,” reads the BlockFi statement, which, incidentally was released to the world via Twitter.

“We will share more specifics as soon as possible,” BlockFi  noted. “We intend to communicate as frequently as possible but anticipate that this will be less frequent than what our clients and other shareholders are used to.”

Jolly good. Sounds like it’s all well in control.

It was only two days ago that BlockFi’s founder and chief operating officer Flori Marquez tweeted that “all BlockFi products are fully operational,” claiming it has a US$400 million line of credit from FTX US (not the full, global version FTX) and is an independent entity until at least July of next year.

 

Around the blocks

Crypto Twitter is an endlessly fascinating, seething hive of emotion, gossip, useful information and sometimes amusing, sometimes sickening displays of bragging, trolling and schadenfreude.

Let’s take a scroll around there one last time in this frustrating, mind-boggling week for the nascent industry.

Here’s a creatively edited version of the “Up Only” podcast clip that’s been circulating today, splicing in FTX boss Sam Bankman-Fried (bottom left) and Su Zhu, one of the disgraced founders of imploded crypto hedge fund Three Arrows Capital (bottom right).

Even the original, unedited version is nuts, though. It includes Crypto Twitter-popular Up Only podcast host “Cobie” (top left), Martin “Pharma Bro” Shkreli (aka the most hated man in America) and another recently disgraced crypto mogul, Terra Luna founder Do “Everything is Fine and I’m Not at All Wanted By Authorities in Singapore and South Korea” Kwon.

Speaking of “Cobie”, he posted this a little earlier. A clip of Caroline Ellison, who is the 28-year-old CEO of Alameda Research – a Sam Bankman-Fried founded trading firm joined at the hip with FTX in the whole liquidity crunch nightmare that’s brought both companies to their knees.

https://twitter.com/cobie/status/1590930337349402624

Meanwhile, what’s Bitcoin lover, “tweet poet and award-winning journalist” Max Keiser got to say about all the crypto-industry shenanigans this week? Probably something highly constructive…

Can’t think at all why much of the crypto industry regards him as “toxic”.

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