Just in: BlockFi has $1.8 billion in outstanding loans in Q2 2022

BlockFi, a centralized cryptocurrency lender, detailed the total amount of loans and net risk exposure it has at the end of Q2 2022, as well as how it manages liquidity and credit risk.



BlockFi revealed that as of the end of the second quarter, it had $1.8 billion in outstanding loans from institutional and retail investors and $600 million in "net exposure."


The information was revealed in the firm's "Q2 2022 Transparency Report," which was released on Thursday and detailed its institutional and retail loan portfolios.


The firm said that $600 million of the $1.8 billion in outstanding loans to customers are uncollateralized loans.


Institutional loans accounted for $1.5 billion of the total outstanding loans, with retail loans accounting for the remaining $300 million.


As a reference point, the firm predicated its holdings and outstanding loan amounts on a Bitcoin (BTC) price of $19,986.


BlockFi stated that it has set criteria to assist it in "maintaining the liquidity required to meet all of our responsibilities under our core business activities, which include institutional and retail borrowing and trading activities."


Those standards provide that it must keep at least 10% of the total amount payable to clients on demand in inventory, ready to be refunded to clients.


It will also keep at least 50% of due funds in locations where they can be retrieved and returned to clients within seven days, and at least 90% of total sums owed to clients on demand, either in inventory or in loans that may be called back within a year.


The new liquidity guidelines were released just a few weeks after BlockFi and crypto exchange FTX.US agreed to send $400 million to BlockFi as a "credit facility," with the option to acquire the company for up to $240 million dependent on performance triggers.


The agreement was reached after prominent crypto investment firm Three Arrows Capital allegedly defaulted on a loan from BlockFi.


BlockFi noted in a Wednesday post describing its risk management that it only makes uncollateralized loans to borrowers it considers "Tier 1" clients.


Tier 1 clients are those with "a significant capital basis, financial records certified by reputable third parties, and a willingness to be transparent and engaged with" BlockFi.

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