As crypto lending platform BlockFi filed for bankruptcy, members of the crypto community reacted with mixed feedback as another platform fell during the current bear market.
Despite BlockFi citing the FTX contagion as the reason for its bankruptcy filing, podcaster Matt Odell pointed out a different explanation. Odell wrote that the lending platform went bankrupt because it was lending customer funds to high-risk traders who played with leverage recklessly. This is a tale as old as Bitcoin, leverage kills, and trusted third parties are security holes.
With many losing funds during the process, some pointed their pitchforks to entrepreneur and podcaster Anthony Pompliano who introduced them to the lending platform. A Twitter user claimed that they lost most of their savings after listening to Pompliano’s podcast that recommended BlockFi.
ShapeShift founder Erik Voorhees also reacted to information coming out that the Securities and Exchanges Commission is one of the creditors for BlockFi. Voorhees floated the idea of the SEC returning $70 million that they took from BlockFi in order to help the users that they should be protecting.
