Blockify announced on Twitter that it has suspended withdrawals and normal trading operations due to a lack of clarity on the current status of FTX.

BlockFi said on its Twitter account late Thursday:

We are shocked and disappointed by the news regarding FTX and Alameda.

FTX and Alameda become the latest victim of the sudden collapse of research.

BlockFi is currently stuck in a financial quandary valued at $3 million.

The company took to Twitter to say that platform activity will be limited for the time being and customer withdrawals will be suspended as permitted under the rules.

BlockFi has not announced any specific time frame for restoring its services.

It announced that ACH deposits and bank transactions scheduled for 11/11 will not be processed until 11/14.

In July, crypto lending and lending institutions experienced a liquidity crunch following a sharp drop in cryptocurrency prices.

In June 2022, BlockFi sought to raise funds at a discounted valuation of around $1 billion, down $2 billion from its original $3 billion valuation in March 2021.

Cryptocurrency lenders have had a bad year due to the downturn in the cryptocurrency market.

In addition, the collapse of stablecoin TerraUSD in May was the catalyst that caused the domino effect.

This led to the collapse of other cryptocurrency lenders such as Celsius Networks and hedge fund Three Arrows Capital.

FTX suffered a surprise drop this week after the cryptocurrency exchange was inundated with customer withdrawal requests over the weekend.

According to the Wall Street Journal, FTX’s financial crisis pushed the company close to bankruptcy as it lent billions of dollars in client assets to finance risky trading bets by Alameda.

This set the scene for the FTX explosion.

The collapse of FTX affected the Solana blockchain on Wednesday, among other major crypto companies such as Crypto.com, which suspended deposits and withdrawals of two stable currencies, USDC and USDT.

Fred Bankman told investors the cryptocurrency exchange will have to file for bankruptcy if it fails to receive cash injections, according to Bloomberg, which received this information from a person directly familiar with the matter.

Also read:

Proof-of-reserves has become a popular trend in the crypto community since the FTX crisis.

According to “JP Morgan”, the crypto market is facing a series of events and the possibility of further decline in the future.