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Must-have rhetoric in the crypto circle? BlockFi CEO: No holdings of GBTC, only used as collateral for loans.

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Must-have rhetoric in the crypto circle? BlockFi CEO: No holdings of GBTC, only used as collateral for loans.

A group of CeFi platforms are facing liquidity crises, with Voyager being the only one declaring bankruptcy so far. The financial situation of the others is difficult to gauge. However, the CEO of BlockFi urged not to compare BlockFi with other insolvent CeFi platforms. Nevertheless, he later admitted to indirectly holding GBTC as collateral, contradicting his earlier claim of having liquidated GBTC holdings in Q3 of last year.

BlockFi: Don't Compare Us to Voyager

Voyager announced bankruptcy protection on 7/6. Both companies had contact with 3AC, faced financial crises, and received support from venture capital firm Alameda Research.

BlockFi CEO Zac Prince tweeted stating:

To the media and market commentators, it is time to stop lumping BlockFi together with Voyager and Celsius. Two months ago, we may have looked similar, but since then Voyager has collapsed, causing losses for users. BlockFi's credit cards, loans, trading, and interest products are all operating normally, with no user losses. In July, we even raised the interest rates on our products, and we have more exciting products in the works.

Concerns Over GBTC Holdings

Coinshares Strategy Chief Meltem Demirors referenced Bloomberg data today, 7/12, pointing out that 3AC and BlockFi still hold a significant amount of GBTC.

This prompted a response from Zac Prince clarifying that the data is outdated, and BlockFi currently has zero GBTC holdings, only a few small loans under $10 million collateralized with GBTC, which are being gradually unwound.

Zac Prince's statements are ambiguous and open to interpretation. He clarified after Celsius suspended withdrawals on 6/13, emphasizing that all products and services were operating normally, the platform did not hold stETH, and they had divested from GBTC in the third quarter of last year.

However, upon closer inspection of the tweets, he mentioned "major" GBTC holdings at that time.

It is difficult to define what constitutes "major" positions in Principal Positions, perhaps only Zac Prince knows. Currently, GBTC is trading at a -31.93% discount, and its application for converting to a spot Bitcoin ETF was rejected by the SEC at the end of June.

Although BlockFi seems to have temporarily weathered financial and acquisition crises, investors should take note that Celsius founder Alex Mashinsky was still denying any issues with withdrawals on Twitter until the day before suspending them.