BlockFi’s bankruptcy filing was expected since FTX had attempted to bail it out after Terra’s collapse.

It was the management team at BlockFi that was responsible for not wasting a single valuable moment and took the opportunity to create and implement alternate methods and measures so as to be able to effectively protect all of its clients from the adverse effects of the FTX bankruptcy and all associated issues.

BlockFi, a cryptocurrency lender has become another firm to fall due to the FTX collapse. BlockFi filed for chapter 11 bankruptcy protection due to extensive exposure to the defunct crypto exchange. However, Ripple General Counsel has allegedly blamed the U.S. SEC for these circumstances.

Venture Capitalist Peter Thiel’s fund, Valar Ventures, owned roughly 19% of BlockFi’s shares, a digital asset lender. The cryptocurrency lender’s abrupt bankruptcy filing has served as a big blow to Thiel’s fund, one of the largest shareholders of BlockFi, as per the bankruptcy filing. The other major shareholders of BlockFi include Bain Capital, Tiger Global, and crypto exchange platform Coinbase (NASDAQ:COIN) among others.

Newly-bankrupt crypto lending platform BlockFi has filed a lawsuit against Sam Bankman-Fried’s holding company Emergent Fidelity Technologies seeking his shares in Robinhood that were pledged as collateral earlier in November.

Crypto bank Silvergate Capital said that less than $20 million of its total deposits from crypto customers come from lender BlockFi, adding that it has "minimal" exposure to the company now in bankruptcy proceedings.

BlockFi’s financial troubles started in May after the Terra Luna crash, which caused the price of crypto assets such as Bitcoin to plunge to new lows.

Silvergate Capital (SI) said in <a href="https://www.businesswire.com/news/home/20221128005747/en/" target="_blank">press release</a> late Monday that its total digital asset deposit relationship with BlockFi, which filed for Chapter 11 bankruptcy protection on Monday, is less than $20 million of of its total deposits from all digital asset customers as of Nov. 28.

On Nov. 28, 2022, the crypto lender Blockfi informed the public via a press release that the company has voluntarily petitioned for Chapter 11 bankruptcy protection. Blockfi is now one of many digital currency businesses dealing with significant financial hardships and bankruptcy proceedings in 2022.

Another former cryptocurrency giant has filed for Chapter 11 bankruptcy protection in the United States.Thus, BlockFi has followed the example of companies like Celsius and Three Arrows Capital.