Lending exposure to a failed fund and to FTX, compounded when a rescue facility from FTX defaulted as FTX itself collapsed.
Counterparty exposure is invisible in any asset-side disclosure. What a platform holds tells you nothing about what it is owed by parties who cannot pay.
These are the custody configurations structurally exposed to this kind of event. It describes the failure class, not any individual holder.
Whether your own arrangement sits in one of those groups is the question our Custody Independence Standard is designed to answer, and the four questions in Is your custody setup actually safe? walk through it.
Chapter 11 filings
Figures are as reported by the named sources. Proof of Custody has not independently reproduced the underlying analysis.
Proof of Custody, "BlockFi" incident record, proofofcustody.io/incidents/blockfi-2022Lending exposure to a failed fund and to FTX, compounded when a rescue facility from FTX defaulted as FTX itself collapsed. Reported loss: Hundreds of millions.
Counterparty exposure is invisible in any asset-side disclosure. What a platform holds tells you nothing about what it is owed by parties who cannot pay.
This class of failure could reach: bitcoin lent or earning yield. It describes the failure class rather than any individual holder.