The Facts
BlockFi, a New Jersey-based cryptocurrency lender, announced Monday that it has filed for Chapter 11 bankruptcy protection after the firm was caught up in the recent collapse of the FTX exchange.
In June, Sam Bankman-Fried's FTX bailed out Zac Prince's BlockFi with a loan of $250M and later partnered with the cryptocurrency lender. But FTX filed for bankruptcy on Nov. 11.
The Spin
Narrative A
This is just one of many digital-asset firms to collapse, demonstrating that stringent government regulations for transactions in virtual coins are necessary. An unregulated business environment may have irreversible and disastrous economic consequences — for lenders, buyers, and the state.
Narrative B
The whole point of cryptocurrency is its decentralized structure and immunity to being governed by wealthy conglomerates or authoritarian governments. It's essential to keep cryptocurrency technology as it's supposed to be – decentralized and transparent – to avoid further crypto explosions and bankruptcies.
