BlockFi Quickly Reverses Plan to Stop Accepting GBTC as Collateral

The troubled crypto lender BlockFi said earlier Tuesday that it would no longer accept shares of the Grayscale Bitcoin Trust as collateral. A few hours later, the company said in a statement that "We are not saying that we won't support GBTC as collateral moving forward."

AccessTimeIconJul 12, 2022 at 6:31 p.m. UTC
Updated May 11, 2023 at 5:36 p.m. UTC

UPDATE (20:49 UTC): Adds statement from BlockFi that it is not saying it will not support GBTC as collateral.

Crypto lending platform BlockFi, after asserting earlier Tuesday that it would no longer accept shares in the Grayscale Bitcoin Trust (GBTC) as collateral for loans, reversed its position later in the day and issued a statement that, "We are not saying that we won't support GBTC as collateral moving forward."

  • Fed Sees Just One Rate Cut This Year; CRV Slides as Curve’s Founder Faces Liquidation Risk
    01:49
    Fed Sees Just One Rate Cut This Year; CRV Slides as Curve’s Founder Faces Liquidation Risk
  • What's Next for Bitcoin After Fed Predicts Just One Rate Cut for 2024
    00:50
    What's Next for Bitcoin After Fed Predicts Just One Rate Cut for 2024
  • Litecoin Creator Charlie Lee on Company Evolution
    09:05
    Litecoin Creator Charlie Lee on Company Evolution
  • U.S. CPI Returns Flat in May; Donald Trump Wants All Remaining Bitcoin to Be 'Made in USA'
    01:45
    U.S. CPI Returns Flat in May; Donald Trump Wants All Remaining Bitcoin to Be 'Made in USA'
  • According to a BlockFi representative: “While we don't currently hold any positions in GBTC and are winding down a couple of loans where GBTC is part of the collateral package, we are not saying that we won't support GBTC as collateral moving forward. Like any collateral, we constantly evaluate appropriate collateral haircut ratios and aim to accept as many types of collateral that our client's hold as possible."

    Earlier in the day, BlockFi had communicated plans to make an official announcement regarding GBTC later this week, according to The Block, which first reported the original news report.

    • Responding to a tweet on Monday from CoinShares' Meltem Demirors – who claimed BlockFi still holds "a ton of GBTC" on its balance sheet – BlockFi CEO Zac Prince said his company "directly holds zero GBTC." He added there remains a couple of small loans with GBTC as collateral that BlockFi is in the process of winding down.
    • Grayscale Investments, the manager of GBTC, is owned by Digital Currency Group, the parent company of CoinDesk.
    • The report was confirmed to CoinDesk earlier in the day by a BlockFi representative.



    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Author placeholder image

    Jimmy is a CoinDesk markets reporter.