Billion-Dollar Oopsie

GM Readers!📪 It's BitDegree Insider, and there's no time to waste.

⭐️Today's selection:

• 🤦‍♀️BlockFi's Billion-Dollar Blunder
• 🧑‍🌾SBF Kept $50M At A Small Village Bank
• 💭Wednesday's Bubbles
• 👌Selected Meme of The Day
• 📰Bite-Sized News

BLOCKFI'S BILLION-DOLLAR BUNDLE

The bankrupt cryptocurrency lender BlockFi has made a significant mistake by publishing uncensored documents.

By doing so, they accidentally revealed the real amounts "stuck" on FTX and Alameda Research. Oops.

It turns out that BlockFi held $415.9 million in assets at the Bankman-Fried's crypto exchange and lent $831.3 million to Alameda.

BlockFi had previously not disclosed specific amounts in their documents, citing trade secrecy. 

However, now the company is devoting a great deal of effort to recovering its obligations to its counterparties.

In an effort to recover its financial standing, BlockFi announced yesterday that it would sell loans to miners, secured against mining equipment.

The loans make up $160 million, and they are trying to recover the money they have invested in other companies.

Collateral for most of these loans is insufficient due to the fall in prices for ASIC (equipment for mining). Some of them are even in default.

Apparently, BlockFi is trying to get something out of this situation.

Over the past 12 months, the value of mining equipment has fallen by almost 85%. The industry is in a difficult position, and major miners have sold almost all of the BTC stock produced in 2022.

This news about BlockFi's financial struggles could have a ripple effect on the entire crypto industry. 

The sale of collateralized loans in the form of mining rigs could hit the industry hard. It's possible that some of the equipment will be forcibly liquidated.

With the industry in such a precarious state, it's worth keeping an eye on how BlockFi's situation develops.

TL;DR: Bankrupt crypto lender BlockFi accidentally revealed that they had $415.9 million in assets at the Bankman-Fried's crypto exchange and lent $831.3 million to Alameda.

SBF KEPT $50M AT A SMALL VILLAGE BANK

You know the saying, hiding in plain sight? Well, SBF probably applied it to practice as well.

The U.S. Attorney's Office seized nearly $50 million in funds that Sam Bankman-Fried kept at Farmington Bank.

It's a small institution in rural Washington state. It used to work only with farmers by giving out loans to them.

Before SBF's investment, the bank had only three people as their staff. It did not offer online services and did not even issue cards. Only 176 people live in the village itself.

In 2022, Alameda Research bought a stake in Farmington Bank and changed its name to Moonstone.

They paid $11.5 million on this deal. Interestingly enough, the purchase amount was twice as much as the bank's entire equity.

Later, Sam Bankman-Fried opened an account here and deposited $49,999,500. This amount is part of the $700 million that the U.S. confiscated from SBF last week.

Within a couple of months, the little-known bank was the 26th largest in the U.S. The latest report shows that the bank had 36 employees and $115 million in the capital, instead of just 3 workers.

The bank doesn't talk directly about cryptocurrencies on its website. But it declares its commitment to "cutting-edge technology".

After the whole debacle happened, Moonstone said it would revert to the Farmington name and go back to working with farmers again. Fair enough.

TL;DR: U.S. Prosecutors found $50 million that belongs to SBF in small village bank that was mainly used by farmers.

WEDNESDAY'S BUBBLES

Time flies, some bubbles pop, while others continue getting bigger. Here are the most optimism-inducing coins judging by their last week's performance.

SELECTED MEME OF THE DAY

BITE-SIZED NEWS

• Malicious Actors Create Fake Binance and Ripple Websites and Emails. Unlike bad actors, malicious actors actually convince their audience.
• Australia's Growing Crypto ATM Market: Overcoming Stricter Regulations. The ATM situation is taking place at the moment.
• Blockstream Secures $125 Million in Funding to Expand Bitcoin Mining Operations. Some companies go belly up, while others go just up.