Sam Bankman-Fried’s crypto empire has a $1.2 billion relationship with BlockFi’s secret financials

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BlockFi

Bankrupt crypto lender BlockFi had more than $1.2 billion in assets linked to Sam Bankman-Fried’s FTX and Alameda Research, previously redacted but not redacted according to financial data mistakenly uploaded on Tuesday.

Blockphi’s exposure to FTX was greater than previous disclosures suggested, as the company announced in late November following the bankruptcy of his FTX, which agreed to rescue the troubled lender from its bankruptcy. filed for Chapter 11 bankruptcy protection.

Balances disclosed in unredacted BlockFi filings include $415.9 million in assets related to FTX and an $831.3 million loan to Alameda. These numbers are from January 14th. Both Bankman-Fried companies were involved in his FTX bankruptcy in November, rocking the cryptocurrency market.

Sam Bankman-Fried

BlockFi’s lawyers have previously said that Alameda’s loan was valued at $671 million and that he has $355 million in digital assets frozen on his FTX platform. . Since then, Bitcoin and Ether have risen, increasing the value of these holdings.

The financial presentation was prepared by M3 Partners, an advisor to the Board of Creditors. The law firm is represented by Brown-Rudnick Law Firm and consists exclusively of BlockFi clients who have debts from bankrupt lenders.

An attorney for the creditor’s committee confirmed to CNBC that the unredacted documents were uploaded in error, but declined to comment further.BlockFi’s attorneys did not respond to a request for comment.

A BlockFi representative said in a statement after the article was published that the company

“Prioritize transparency”.

“BlockFi disclosed accurate information to the court as part of its financial statements filed on January 12, 2023,” the representative wrote.

Additional information made available through BlockFi includes customer numbers and general details about account size and trading volume.

BlockFi had 662,427 users, almost 73% of whom had balances under $1,000. In the six months from May to November of last year, the cumulative transaction value of these customers was $67.7 million, for a total of $1.17 billion. According to the presentation, BlockFi generated over $14 million in trading revenue during that period, with an average revenue of $21 per customer.

The corporation had $302.1 million in coins and $366.7 million in assets. Overall, the crypto lender holds about $2.7 billion really well worth of unadjusted assets, almost 1/2 of of that is tied to his FTX and Alameda, the presentation shows. BlockFi’s failure was sparked by exposure to Three Arrows Capital, a cryptocurrency hedge fund that filed for bankruptcy protection in July. FTX arranged a bailout of his BlockFi through a $400 million revolving credit facility, but that deal fell through as FTX faced its liquidity crisis and soon went bankrupt.

According to the latest financial data released by BlockFi, the value of Alameda’s loan bonds and FTX-related assets are both adjusted to $0. After all adjustments, BlockFi’s assets are just under $1.3 billion, of which he’s only listed as “current/to be distributed” at $668.8 million.

BlockFi’s remaining 125 employees will receive substantial compensation under a proposed employee retention plan aimed at retaining some employees during bankruptcy proceedings, the filing shows. I’m here.

Retained employees raise a total of $11.9 million annually. Among the remaining staff, he has three Customer Success Associates, each of whom will earn an average of more than $134,000 annually.

According to the presentation, the average annual salary of his five remaining employees at the company is $822,834, indicating BlockFi’s retention plan is “larger than comparable cryptocurrency cases.”