10 ms·

Withdrawals from BlockFi continue to be paused

236 points by apokusin 4y ago

booleandilemma 4y ago
Wow, I can scarcely keep up with all the crypto news that's been on HN the past couple days. I just closed a story on AAX suspending withdrawals and now I see this. I wonder what the rest of the week will bring.
apokusin 4y ago
US-based crypto exchange BlockFi pauses withdrawals. Quote: > We are shocked and dismayed by the news regarding FTX and Alameda. We, like the rest of the world, found out about this situation through Twitter. Given the lack of clarity on the status of FTX.com, FTX US and Alameda, we are not able to operate business as usual.
- coffeebeqn 4y ago
  BlockFi was rescued by FTX because their ponzi died even earlier.
netol 4y ago
This is 4 days old
- bmitc 4y ago
  Yea, they’ve been disabled (as shown in the date as you mentioned). And it’s no surprise. FTX bailed them out earlier this year, and BlockFi was even shown on the released balance sheet.
- mikeyouse 4y ago
  Sure - but the banner about "BlockFi is not able to operate business as usual" is still on their home page.. seems relevant until (if?) they resume operations.
- pmlamotte 4y ago
  There's an updated post from an hour ago which should probably be the OP https://blockfi.com/november-14-2022-blockfi-update https://blockfi.com/november-14-2022-blockfi-update
  - dang 4y ago
    Good catch - thanks to both of you! We've changed to that URL now from https://blockfi.com/november-11-2022-blockfi-update https://blockfi.com/november-11-2022-blockfi-update. I've moved the generic comments to the other ongoing thread in this equivalence class: Crypto Exchange AAX Suspends Withdrawals - https://news.ycombinator.com/item?id=33593646 https://news.ycombinator.com/item?id=33593646 - Nov 2022 (584 comments)
abzolv 4y ago
Their website still has a yellow notice at the top: > “We have limited platform activity, including pausing client withdrawals as allowed under our Terms. We request that clients not deposit to BlockFi Wallet or Interest Accounts at this time.”
- jakelazaroff 4y ago
  Amazing — so they've blocked withdrawals but they're "requesting" that people not deposit. Seems legit.
  - derekpankaew 4y ago
    You can't prevent someone from sending funds to a crypto address. An address of an insolvent company may not be able to legally return funds; i.e. once they receive funds they may have a fiduciary duty to distribute them in a certain way, for example by order of a bankruptcy court. tl;dr: They may only be able to ask people not to deposit, but not prevent them from depositing. And if users do deposit, they might not be allowed to give it back.
thepasswordis 4y ago
Oh my goodness surely this is going to be the absolute end for cryptocurrencies now isn't it? Is bitcoin now dead?
- AustinDev 4y ago
  Bitcoin is dead. This is good for bitcoin. :D
  - neosat 4y ago
    A lot (most?) of what's happening in Crypto is quite at odds with the proposed direction in the bitcoin paper (e.g. transparency, (de)centralization) So while a much needed correction for 'crypto' in general, this is not necessarily bad for bitcoin long term.
- edwnj 4y ago
  Naaa this is the best thing to happen to bitcoin. Over the last 2 years bitcoin was being eaten up by wall street and technocrats. The OG crypto people were being bribed by all the money coming in and the ones that remained "pure" were being shunned as "toxic btc maxis". This is like a massive wildfire that gets rid of all the "overgrowth". If it wasn't for this, there was a non zero chance that bitcoin would slowly die out. Worse we would've ended up in a dystopian future of CBDCs and social credit etc.
  - boppo1 4y ago
    >Worse we would've ended up in a dystopian future of CBDCs and social credit etc. I think we might still be heading there. The Fed announced recently (iirc) that a CBDC is officially on the way.
- hamiltonians 4y ago
  down 80 percent in a year.already close to dead
  - latchkey 4y ago
kikokikokiko 4y ago
"For further questions, please feel free to contact our Client Success team." Oh the irony.
- BitwiseFool 4y ago
  Which is also funny because its not like the customer support reps are going to be able to assist in any way. They're just as in-the-dark as the public, or only just barely aware of how bad things are. Even so, its not like they are going to be able to calm anyone down. I'm sure each one of them wants to give some kind of reassurance to panicked customers but is powerless to help and is worried about saying anything that could get them in trouble legally.
readthenotes1 4y ago
"We intend to communicate as frequently as possible going forward but anticipate that this will be less frequent than what our clients and other stakeholders are used to." Nothing since Nov 11. Their silence is deafening
- kahrl 4y ago
  This is bullshit for: "Prepare for radio silence, but don't be alarmed. Please continue to hold the bag for us."
  - SV_BubbleTime 4y ago
    I'm sure it takes a little time to solve this issue to the degree any customer should expect from them... Researching non-extradition countries with decent quality of life and decent buying power for your... their money.
- jahlove 4y ago
  https://blockfi.com/november-14-2022-blockfi-update https://blockfi.com/november-14-2022-blockfi-update
kikokikokiko 4y ago
I'm really SHOCKED that a company that was offering 8% interest on deposits mid 2021, when the fed tax rate was around 0%, ended up being a HUGE PONZI. You can't trust nobody, a guy can't get his 500% greater returns in peace no more.
- mirekrusin 4y ago
  Free lambos are for pharaoh only.
- wastedimage 4y ago
  Crazy right. Almost like unlimited money isn't a thing.
- ahMath8 4y ago
  Unless you’re in government where there are no laws against leveraging inside info.
Animats 4y ago
The crypto exchange world is coming apart. FTX, BlockFi, maybe Crypto.com. Institutional investors are getting out. If either Binance or Tether goes down, it's all over. Both are opaque and probably have less reserves then they claim. As withdrawals continue, we'll find out who really has assets. People who like to read financial statements are awaiting the filings in the FTX bankruptcy. For the first time, all those related companies have to file public financial statements under penalty of perjury. Expect a lot of "They did what with that money?!" What may well happen now is that US crypto exchanges, and those that deal with US persons, will be required to become brokers, dealers, or "national securities exchanges" under the Securities Act of 1934, like real stock exchanges.[1] The SEC can now do this, because, last week they finally won the first big lawsuit on whether crypto is a security.[2] Now they can tell all crypto issuers to register and file an S-1 under penalty of perjury, and tell all exchanges to register as brokers, dealers, or exchanges. The crypto community will scream and demand Congress exempt them. No one in Washington will listen any more. Do regulated US exchanges go bust and lose billions of customer funds? No. Any questions? Crypto companies wanted special regulations for crypto, but it's too late for that. They'll probably have to become broker-dealers. Series 7 exams. Registered representatives. FINRA regulation. SIPC insurance. Audits. Compliance departments. (I've had a US broker go bust when they were holding stock of mine. I got it out in about a week, after making a lot of phone calls.) It's not the end of the crypto world. Gemini will probably become a regulated exchange. Maybe Coinbase. [1] https://www.law.cornell.edu/uscode/text/15/chapter-2B https://www.law.cornell.edu/uscode/text/15/chapter-2B [2] https://www.natlawreview.com/article/sec-v-lbry-inc-sec-s-latest-crypto-victory https://www.natlawreview.com/article/sec-v-lbry-inc-sec-s-la...
- capkutay 4y ago
  Coinbase basically played by the rules, wanted to work with the SEC, takes public audits and a 1:1 ratio between liabilities and reserves in US dollars (not their own funny money tokens). And yet they were surpassed in # of users by growth hacking crypto gamesmen like SBF who wanted to drum up the largest possible liquidity pool to use however they pleased with no oversight or regulation.
  - 4y ago
g9yuayon 4y ago
This is amazing. So another exchange committed bank fraud, and BlockFi's answer is to block withdraw. Does it smell something very fishy or just me?

236 points by apokusin 4y ago

Wow, I can scarcely keep up with all the crypto news that's been on HN the past couple days. I just closed a story on AAX suspending withdrawals and now I see this. I wonder what the rest of the week will bring.

apokusin 4y ago

US-based crypto exchange BlockFi pauses withdrawals. Quote: > We are shocked and dismayed by the news regarding FTX and Alameda. We, like the rest of the world, found out about this situation through Twitter. Given the lack of clarity on the status of FTX.com, FTX US and Alameda, we are not able to operate business as usual.

coffeebeqn 4y ago
BlockFi was rescued by FTX because their ponzi died even earlier.

netol 4y ago

This is 4 days old

bmitc 4y ago
Yea, they’ve been disabled (as shown in the date as you mentioned). And it’s no surprise. FTX bailed them out earlier this year, and BlockFi was even shown on the released balance sheet.
mikeyouse 4y ago
Sure - but the banner about "BlockFi is not able to operate business as usual" is still on their home page.. seems relevant until (if?) they resume operations.
pmlamotte 4y ago
There's an updated post from an hour ago which should probably be the OP https://blockfi.com/november-14-2022-blockfi-update https://blockfi.com/november-14-2022-blockfi-update
- dang 4y ago
  Good catch - thanks to both of you! We've changed to that URL now from https://blockfi.com/november-11-2022-blockfi-update https://blockfi.com/november-11-2022-blockfi-update. I've moved the generic comments to the other ongoing thread in this equivalence class: Crypto Exchange AAX Suspends Withdrawals - https://news.ycombinator.com/item?id=33593646 https://news.ycombinator.com/item?id=33593646 - Nov 2022 (584 comments)

abzolv 4y ago

Their website still has a yellow notice at the top: > “We have limited platform activity, including pausing client withdrawals as allowed under our Terms. We request that clients not deposit to BlockFi Wallet or Interest Accounts at this time.”

jakelazaroff 4y ago
Amazing — so they've blocked withdrawals but they're "requesting" that people not deposit. Seems legit.
- derekpankaew 4y ago
  You can't prevent someone from sending funds to a crypto address. An address of an insolvent company may not be able to legally return funds; i.e. once they receive funds they may have a fiduciary duty to distribute them in a certain way, for example by order of a bankruptcy court. tl;dr: They may only be able to ask people not to deposit, but not prevent them from depositing. And if users do deposit, they might not be allowed to give it back.

thepasswordis 4y ago

Oh my goodness surely this is going to be the absolute end for cryptocurrencies now isn't it? Is bitcoin now dead?

AustinDev 4y ago
Bitcoin is dead. This is good for bitcoin. :D
- neosat 4y ago
  A lot (most?) of what's happening in Crypto is quite at odds with the proposed direction in the bitcoin paper (e.g. transparency, (de)centralization) So while a much needed correction for 'crypto' in general, this is not necessarily bad for bitcoin long term.
edwnj 4y ago
Naaa this is the best thing to happen to bitcoin. Over the last 2 years bitcoin was being eaten up by wall street and technocrats. The OG crypto people were being bribed by all the money coming in and the ones that remained "pure" were being shunned as "toxic btc maxis". This is like a massive wildfire that gets rid of all the "overgrowth". If it wasn't for this, there was a non zero chance that bitcoin would slowly die out. Worse we would've ended up in a dystopian future of CBDCs and social credit etc.
- boppo1 4y ago
  >Worse we would've ended up in a dystopian future of CBDCs and social credit etc. I think we might still be heading there. The Fed announced recently (iirc) that a CBDC is officially on the way.
hamiltonians 4y ago
down 80 percent in a year.already close to dead
- latchkey 4y ago

kikokikokiko 4y ago

"For further questions, please feel free to contact our Client Success team." Oh the irony.

BitwiseFool 4y ago
Which is also funny because its not like the customer support reps are going to be able to assist in any way. They're just as in-the-dark as the public, or only just barely aware of how bad things are. Even so, its not like they are going to be able to calm anyone down. I'm sure each one of them wants to give some kind of reassurance to panicked customers but is powerless to help and is worried about saying anything that could get them in trouble legally.

readthenotes1 4y ago

"We intend to communicate as frequently as possible going forward but anticipate that this will be less frequent than what our clients and other stakeholders are used to." Nothing since Nov 11. Their silence is deafening

kahrl 4y ago
This is bullshit for: "Prepare for radio silence, but don't be alarmed. Please continue to hold the bag for us."
- SV_BubbleTime 4y ago
  I'm sure it takes a little time to solve this issue to the degree any customer should expect from them... Researching non-extradition countries with decent quality of life and decent buying power for your... their money.
jahlove 4y ago
https://blockfi.com/november-14-2022-blockfi-update https://blockfi.com/november-14-2022-blockfi-update

kikokikokiko 4y ago

I'm really SHOCKED that a company that was offering 8% interest on deposits mid 2021, when the fed tax rate was around 0%, ended up being a HUGE PONZI. You can't trust nobody, a guy can't get his 500% greater returns in peace no more.

mirekrusin 4y ago
Free lambos are for pharaoh only.
wastedimage 4y ago
Crazy right. Almost like unlimited money isn't a thing.
ahMath8 4y ago
Unless you’re in government where there are no laws against leveraging inside info.

Animats 4y ago

The crypto exchange world is coming apart. FTX, BlockFi, maybe Crypto.com. Institutional investors are getting out. If either Binance or Tether goes down, it's all over. Both are opaque and probably have less reserves then they claim. As withdrawals continue, we'll find out who really has assets. People who like to read financial statements are awaiting the filings in the FTX bankruptcy. For the first time, all those related companies have to file public financial statements under penalty of perjury. Expect a lot of "They did what with that money?!" What may well happen now is that US crypto exchanges, and those that deal with US persons, will be required to become brokers, dealers, or "national securities exchanges" under the Securities Act of 1934, like real stock exchanges.[1] The SEC can now do this, because, last week they finally won the first big lawsuit on whether crypto is a security.[2] Now they can tell all crypto issuers to register and file an S-1 under penalty of perjury, and tell all exchanges to register as brokers, dealers, or exchanges. The crypto community will scream and demand Congress exempt them. No one in Washington will listen any more. Do regulated US exchanges go bust and lose billions of customer funds? No. Any questions? Crypto companies wanted special regulations for crypto, but it's too late for that. They'll probably have to become broker-dealers. Series 7 exams. Registered representatives. FINRA regulation. SIPC insurance. Audits. Compliance departments. (I've had a US broker go bust when they were holding stock of mine. I got it out in about a week, after making a lot of phone calls.) It's not the end of the crypto world. Gemini will probably become a regulated exchange. Maybe Coinbase. [1] https://www.law.cornell.edu/uscode/text/15/chapter-2B https://www.law.cornell.edu/uscode/text/15/chapter-2B [2] https://www.natlawreview.com/article/sec-v-lbry-inc-sec-s-latest-crypto-victory https://www.natlawreview.com/article/sec-v-lbry-inc-sec-s-la...

capkutay 4y ago
Coinbase basically played by the rules, wanted to work with the SEC, takes public audits and a 1:1 ratio between liabilities and reserves in US dollars (not their own funny money tokens). And yet they were surpassed in # of users by growth hacking crypto gamesmen like SBF who wanted to drum up the largest possible liquidity pool to use however they pleased with no oversight or regulation.
- 4y ago

g9yuayon 4y ago

This is amazing. So another exchange committed bank fraud, and BlockFi's answer is to block withdraw. Does it smell something very fishy or just me?