News

BlockFi Will No Longer Accept Grayscale GBTC Shares As Collateral, Unwinds All Positions

Published by
BlockFi Will No Longer Accept Grayscale GBTC Shares As Collateral, Unwinds All Positions

Crypto lenders in the market have been severely struggling to handle liquidity challenges. On Tuesday, July 12, crypto lender BlockFi announced that it will no longer be accepting Grayscale’s GBTC shares as collateral.

Following the news, the GBTC stock (OTCMKTS: GBTC) collapsed 5% on Tuesday ending at $12.21. Amid the Bitcoin price correction, the GBTC stock has been on a freefall this year. The share price of Grayscale Bitcoin Trust (GBTC) has corrected by nearly 65% year-to-date.

The recent decision from BlockFi highlights the fragility of the crypto lending industry and its exposure to insolvent companies. Grayscale had exposure to Three Arrows Capital, which was holding more than 5% of GBTC stock at one point in time.

Due to its bad debt with Three Arrows, BlockFi is already suffering losses to the tune of $80 million. BlockFi CEO Zac Prince spoke about their exposure in 3AC and added that they will be part of the embattled hedge fund’s ongoing bankruptcy case.

BlockFi Unwound Its GBTC Position

As per the latest information, BlockFi has already unwound all its GBTC position. On Tuesday, July 12, Zac Price replied to Meltem Demirors regarding the same. Prince tweeted:

Hey Meltem 🙂 Just fyi – BlockFi directly holds zero GBTC. The Bloomberg data on this is outdated. We have a couple small loans (like sub $10M) w/ GBTC as collateral that are in the process of winding down.

Last month, BlockFi entered an agreement with FTX US to come out of its liquidity woes. As per the agreement, FTX US would extend a $400 million revolving credit facility along with the option for the exchange to acquire BlockFi for an amount of $240 million.

In comparison to other crypto lenders like Celsius Networks and Voyager Digital, BlockFi has been doing relatively well. Even in these distressed markets, BlockFi hasn’t stopped customer withdrawals, unlike its other peers.

Advertisement

Share
Bhushan Akolkar

Bhushan is a seasoned crypto writer with over eight years of experience spanning more than 10,000 contributions across multiple platforms like CoinGape, CoinSpeaker, Bitcoinist, Crypto News Flash, and others. Being a Fintech enthusiast, he loves reporting across Crypto, Blockchain, DeFi, Global Macros with a keen understanding in financial markets. 

He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills. Bhushan has a bachelors degree in electronics engineering, however, his interest in finance and economics drives him to crypto and blockchain.

Published by
Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Recent Posts

  • News

Senators Reaffirm Commitment to Market Structure Bill After Meeting with Coinbase, Ripple

Senate Democrats and Republican lawmakers have ended separate roundtable meetings focused on the Crypto Market…

October 23, 2025
  • News

How the Crypto Market Could React to the Next Fed Meeting on October 29?

The crypto market has, for a while now, been pricing a potential 25 basis points…

October 23, 2025
  • News

$1.68 Trillion T. Rowe Price Files for First Active Crypto ETF Holding BTC, ETH, SOL, and XRP

Rowe Price has filed for its first actively managed crypto exchange-traded fund (ETF). It is…

October 22, 2025
  • News

Standard Chartered Predicts Bitcoin Could Drop Below $100K Amid U.S.–China Trade Tensions

Standard Chartered analyst Geoff Kendrick has predicted that the Bitcoin price could suffer a significant…

October 22, 2025
  • News

Rising Demand for Verifiable Crypto Ownership Drives Launch of Trezor Safe 7

Crypto ownership is a topic that has been discussed across major forums globally in the…

October 22, 2025
  • News

Robinhood Lists Binance Coin as BNB Outperforms BTC, ETH, SOL YTD By Over 30%

Crypto exchange Robinhood has listed the Binance coin for spot trading for its U.S. customers.…

October 22, 2025