BlockFi - So You Cannot Withdraw Your Crypto
Crypto is the wild west. Well, it is more than the wild west. One collapsed along with others and put the whole crypto market down. Lending platform BlockFi just blocked clients' withdrawal. Do you know why? It is because it is allowed under their terms.
This bear market teaches a very valuable lesson. You cannot trust any centralized platforms, no matter what. How quickly FTX CEO Sam Bankman-Fried or SBF became so popular and he was considered the next Warren Buffett.
FTX felt like a safe haven. You can trust their exchange. Big players in crypto talked about FTX and made you feel how good and secure that exchange was. There is no way those people are wrong. They did enough research before talking about anything in crypto.
Maybe they did not have any idea what was going on behind the scene. They were paid well for sponsorships and happily talked about FTX. FTX CEO Sam Bankman-Fried acted like a savior when Luna crashed and made his move. It seems the financial condition of their platform is very good and they can handle any situation.
You cannot see being a trader, FTX CEO does not know how to manage the risk. You put your trust and crypto in the exchange and they get involved in highly risky trades and activities.
Is it just FUD that took everything down? When there is smoke, something is burning over there. You may not see that, but it is what it is. How could they say everything is "fine" when nothing is fine? So what's the explanation?
It is clear that there is a big difference between what they say and what they actually do. They will not even admit it unless things burn down. Whatever they say now, is it going to fix anything? Once trust is broken, it's done. People may not fall into the same trap again.
Some people said Celsius was bad, but BlockFi was good. BlockFi would not block any withdrawal. Well, BlockFi is shocked to see what happened in FTX and Alameda Research. So what's their next move?
BlockFi finalized limiting platform activity, especially pausing client withdrawals since it is allowed under their terms. It proved once again, not your keys, not your crypto. Period.
So what do you think? Please feel free to leave your comments. Thank you for reading this post. That's it for now. I'll be back with another post.
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FTX was benefical for Binance and not benefical for other platforms.