BlockFi declares bankruptcy, market still rally
Cryptocurrencies are having some hard time recently. Many declared bankruptcy and problems still continue.
U.S. stocks fell on warnings from Fed officials to underestimate higher interest rates, as they were determined to curb inflation. Asian stocks rallied in the early hours of Tuesday as nationwide protests against China's zero-case strategy for Covid eased. The dollar fell as risk appetite returned.
BlockFi declares bankruptcy, market still rally
Major cryptocurrencies rallied despite the fall of another major lender amid the spread of the FTX contagion. Bitcoin is trading near the $16.5k region at the time of writing, after posting a 2% increase in the last 24 hours. The largest cryptocurrency by market cap has shown some resilience in its price action despite a wider slowdown in asset activity and further bursts related to the FTX crash. Ethereum is up 3.3% over the same period and is now attempting to establish stronger ground above $1,200. Most major altcoins have turned green, with LINK and a handful of meme coins leading the rebound in double-digit percentage gains over a similar time frame.
As the industry continues to absorb the aftershock of recent blows, the amount of synthetic Bitcoin holdings on Ethereum continues to drop to an all-time high of 338,000 in April. The team behind renBTC, which lost its funds after Alameda Research filed for bankruptcy, halted its issuance. The team decided to phase out the Alameda linked Ren 1.0 and launch version 2.0 when they find more funding. WBTC, the largest supplier of Bitcoin on Ethereum, was swamped over the weekend with fears of an impending de-peg, but has since reassured some confidence after its official guardian reassured that WBTC is secure and fully supported.
Crypto credit institution BlockFi has filed for bankruptcy on Monday, citing the latest contagion effects brought about by the FTX collapse. According to the firm's bankruptcy petition, BlockFi claimed more than 100,000 creditors with $1 billion in assets and $10 billion in liabilities. Bankruptcy gives BlockFi the opportunity to formulate a repayment plan for creditors and get back what they can get from FTX, but potential repayments are a long way off. The firm's advisor, Mark Renzi, acknowledged in a court filing that "the consequences of FTX's collapse will be fully determined."
