BlockFi Creditor Committee: BlockFi CEO Ignored Risk Warnings About Alameda and FTX

According to ChainCatcher, documents submitted by the BlockFi unsecured creditors' committee to the New Jersey federal bankruptcy court state that BlockFi CEO Zac Prince ignored warnings from the company's risk management team regarding the risks of lending assets to Alameda.

The documents indicate that BlockFi's risk management team reported "high risks" associated with lending assets to Alameda. However, Prince disregarded the team's concerns about BlockFi lending $217 million to Alameda in August 2021, with the team stating that there could be risks if the FTX tokens (FTT) used as collateral for the loan needed to be liquidated.

The documents further noted that the collapse of Alameda/FTX may have triggered BlockFi's downfall, but the roots of BlockFi's collapse lay in business practices and decisions made prior to the bankruptcy filing of Alameda/FTX.