This last week in Bitcoin has been both entertaining and cathartic! Watching shitcoin projects and the VC’s who support them get REKT is therapeutic. For years we have railed against these clowns while they stood in their pulpits shilling these garbage products to their huge followings. Many of us took friendly fire from hopium drunk Bitcoiners who naively became their simps and attacked us for speaking up.
Blockfi’s implosion in particular is very significant. In their heyday they paid off a network of big mouthed Bitcoin influencers to push their garbage products all while bragging about the money they made from it. The tables have finally turned, and their day of reckoning is here.
Crypto World reported, “FTX Closes in on deal to buy embattled crypto lender BlockFi for $25 million in a fire sale.” Blockfi customers appear to be safe at this point, but the investors will lose everything. Crypto World also stated, “The price tag is 99% below BlockFi’s last valuation, leaving equity investors in BlockFi “wiped out” and writing off the value of their losses.” How the hell does a company go from a valuation of 4.8 billion less than a year ago to being sold in a fire sale for 25 million? It’s because the smoke and mirrors of over leveraged Bitcoin venture funded companies are finally being exposed!
The CEO refutes Crypto World’s report, but he can’t deny Blockfi is a dumpster fire at this moment. Stay tuned and we will see how this shit show plays out!
So what does this mean?
It means VC’s in the space who both promoted and pushed this crap are taking huge losses. These donkeys can bitch at us “tOxIc mAxImaLisTs” all they want, but we were right. Many of us raised red flags over the last few years as we watched the meteoric rise of Blockfi and knew it was only a matter of time before this risky business model imploded. Times like this remind me of the old Scooby Doo cartoons when the bad guy’s mask is pulled off and we find out who the bad actors are.
Bad Actors Suck
The biggest take away from all of this is to question everyone’s motives in this game. I know many of you love to have someone to look up to or to listen to for your hopium fix, but eventually they will let you down. The bigger the follower count, the more suspicious you should be. These idiots are paid to promote sketchy products. They don’t give a shit about you nor do they care when things go south. Blockfi, the VC’s and Bitcoin influencers who helped market this company deserve to be wiped out. You won’t hear any apologies from them. They will just move on to push the next bullshit product!
Remember the people who are involved in pushing these failed projects. These individuals are the cancer of Bitcoin. They have somehow fooled a lot of people into thinking they are important because of their large followings, but in reality they are nothing but used car salesmen willing to fleece anyone for a buck. Fortunately karma is a bitch and this time they will pay dearly for their bad behavior.
Bockfi CEO Zac Prince provided an update today. He claims FTX and Blockfi agreed to some really fuzzy math that values the deal/bailout at $680 million. As Zak states, “This, together with other potential consideration, represents a total value of up to $680M.” I really hate how he is spinning this as a good thing when Blockfi went from a 4.8 billion dollar valuation to this. There are lines of credit involved as well as performance triggers and other technical voodoo to get to these “projected” numbers.
At least they can say they did not get aquired in a fire sale for 25 million, but considering the black eye they now have and a declining “cRyPto” market, I do not see how they can reasonably scale their customer base. Consumer trust has been breached and only time will tell. You can read more about what Zac has to say in this thread.
Written by @piratebeachbum2
Peter “pandemic of the unvaccinated” McCormack