BlockFi revealed that as of the end of the second quarter, it had $1.8 billion in existing loans from institutional and retail investors and $600 million in "net exposure."
The information was revealed in the firm's Transparency Report for the Second Quarter, which was released on July 21 and detailed its institutional and retail loan portfolios. It recorded that $600 million of the $1.8 billion outstanding loans to borrowers are uncollateralized.
The remaining $300 million was made up of retail loans, which accounted for $1.5 billion of the total existing loans. As a reference point, the firm's holdings and outstanding loan amounts were calculated using a Bitcoin (BTC) price of $19,986.
The company stated that it has formed guidelines to assist it in "maintaining the liquidity necessary to meet all of our obligations under our core business activities, which include institutional and retail borrowing and trading activities."
According to those guidelines, it must keep at least 10% of the total amount due to clients on demand in inventory, ready to be returned to clients.
It will also keep at least 50% of owed funds in places where they can be retrieved and returned to clients within seven days, and at least 90% of total amounts owed to clients on demand in inventory or loans that can be called back within a year.
The new liquidity guidelines were released just a few weeks after the company and crypto exchange FTX.US agreed to send $400 million as a "credit facility," with the option to acquire the company for up to $240 million based on performance triggers.
The agreement was reached after major crypto investment firm Three Arrows Capital allegedly defaulted on a loan from BlockFi.In a July 20 post outlining its risk management, the lending company explained that it only makes uncollateralized loans to borrowers it considers "Tier 1" clients. Tier 1 clients are those with "a significant capital base, financial statements audited by reputable third parties, and a willingness to be transparent and engaged with" BlockFi.Uncollateralized loans are not permitted for "Tier 2 and Tier 3" clients.