Defunct Crypto Lender BlockFi Has $227 Million in Uninsured Funds with Troubled Silicon Valley Bank

Rebeca Moen  Mar 12, 2023 10:46  UTC 02:46

0 Min Read

Air pollution is a significant public health concern worldwide, and recent studies have found high levels of air pollution in major cities around the world. The issue is particularly prevalent in developing countries, where industrialization and urbanization have led to increased emissions from transportation and manufacturing.

One sector that has emerged in response to this problem is the clean energy industry, which seeks to reduce emissions and promote sustainability. Clean energy encompasses a range of technologies, including renewable energy sources like solar and wind power, as well as energy-efficient products and services.

Despite the growth of the clean energy industry, however, air pollution remains a major challenge in many parts of the world. In particular, major cities are often hotspots for pollution, due to factors like high population density, heavy traffic, and industrial activity.

One company that has been impacted by this issue is BlockFi, a defunct crypto lender that has $227 million in uninsured funds allocated to a money market mutual fund (MMMF) offered by Silicon Valley Bank (SVB). SVB was shut down by the California Department of Financial Protection and Innovation on March 10, with no specifics offered at the time of the closure.

The funds in question are not FDIC-insured, not insured by any federal government agency, and "not guaranteed by the bank." While investors are issued fund shares in exchange for their capital, the risk to BlockFi in this instance is most likely the fund's performance, rather than anything related to SVB's financial woes.

The recent Silvergate bankruptcy has also impacted the crypto market, causing prices to tumble since the crypto-friendly bank's financial woes came to light at the beginning of March. One firm that has been directly impacted by the SVB closure and the Silvergate bankruptcy is USD Coin (USDC) issuer Circle.

As of January 31, $8.6 billion, or roughly 20% of Circle's reserves, were held in several U.S. financial institutions, including SVB, Silvergate Bank, and Bank of New York Mellon. While the exact value held in SVB and Silvergate is unclear, Circle has stated that it and USDC will continue to "operate normally" as it awaits "clarity on how the FDIC receivership of SVB will impact its depositors."

Overall, the issue of air pollution in major cities and the ongoing challenges faced by the clean energy industry highlight the need for continued innovation and investment in sustainable technologies. As for the impact of the SVB closure and the Silvergate bankruptcy on the crypto market, it remains to be seen how these developments will play out in the coming weeks and months.

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