BlockFi was one of the companies that liquidated the collateral on a loan from Singapore-based crypto hedge fund Three Arrows, according to the Financial Times.
The Block had previously reported that the liquidation totaled at least $400 million and that the firm faces potential insolvency.
The company had borrowed bitcoin from BlockFi but failed to meet a margin call on that loan, according to the Financial Times.
CEO of BlockFi Zac Prince seemed to comment on the situation while saying that he would not mention "specific counterparties."
"BlockFi can confirm that we exercised our best business judgment recently with a large client that failed to meet its obligations on an overcollateralized margin loan. We fully accelerated the loan and fully liquidated or hedged all the associated collateral," he said. "We believe we were one of the first to take action with this counterparty."
Prince also argued that the company needs to act with "prudent and proactive risk management" in order to stay afloat "during times of market stress."