GBTC - Crypto lender BlockFi stops accepting Grayscale Bitcoin Trust as collateral: Bloomberg

Cryptocurrency lender BlockFi has stopped accepting Grayscale Bitcoin Trust ( OTC:GBTC ) as collateral and has scaled back from positions related to the investment fund amid contagion spreading from the collapse of hedge fund Three Arrows Capital, Bloomberg reported Tuesday, citing a person with knowledge on the matter.

Both Grayscale, the manager of ( OTC:GBTC ), and BlockFi have been exposed to the bankrupt 3AC. BlockFi has already incurred $80M in losses from 3AC's bad debt, Bloomberg noted.

BlockFi CEO Zac Prince wrote in a Twitter post Monday that his company "directly holds zero GBTC," and "we have small loans (like $10M) w/ GBTC as collateral that are in the process of winding down."

Recall at the end of June when Sam Bankman-Fried's FTX US has reached an deal with BlockFi that will give FTX the option to acquire the embattled crypto lender for a variable price of up to $240M.

Note that BlockFi has been one of the few major crypto lenders to maintain operations and not freeze customer withdrawals, as is the case with Celsius, Voyager Digital ( OTCPK:VYGVF ) and Babel Finance.

In mid-June, BlockFi planned to lay off some workers as market downturn intensifies .

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