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BlockFi files for bankruptcy, Aave temporarily freezes specific credit markets, and Game7 allocates $100M for Web 3.0 game companies.

BlockFi files for bankruptcy

BlockFi announced on November 28 that it had filed for Chapter 11 bankruptcy. The filing in the Bankruptcy Court for the United States District of New Jersey involves the company and its eight subsidiaries. This development comes after several days of speculation about the company’s financial condition after the collapse of FTX.

FTX.US received a $400 million line of credit at the end of June, raising concerns that it would cause BlockFi to experience a liquidity crisis after the FTX crash. BlockFi stopped withdrawals on November 11.

According to a statement made by BlockFi, the company has $ 256.9 million in hand. The company made proposals for the payment of employee salaries and for the uninterrupted continuation of employee benefits. BlockFi also aims to establish a ‘Key Employee Retention Plan’ to ensure the company retains trained internal resources for business-critical functions and says it has created an internal plan to reduce costs.

The statement suggests that BlockFi International has also filed for bankruptcy in the Bermuda Supreme Court. “As part of our restructuring efforts, we will focus on recovering all liabilities owed to BlockFi by counterparties, including FTX,” the company said in its latest tweet.

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Aave temporarily freezes specific credit markets

Decentralized liquidity protocol Aave has temporarily suspended the credit markets of 17 tokens to avoid volatility risks that could result in an attempt to market manipulation.

These credit markets were frozen shortly after Aave governance members voted to temporarily freeze highly volatile and illiquid assets. Credit markets discontinued assets include (YFI), Curve Finance (CRV), 0x (ZRX), Decentraland (MANA), 1inch (1INCH), Basic Attention Token (BAT), Enjin (ENJ), Ampleforth (AMPL), DeFi Pulse Index (DPI), RENFIL, Maker (MKR) and SUSHI.

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The protocol also suspended the following stablecoins: sUSD, Pax Dollar (USDP), Liquidity USD (LUSD), Gemini Dollar (GUSD), and RAI. After the freeze, users will not be able to take loans in this asset or deposit these assets into the protocol.

The proposal aims to mitigate risk for Aave v2 and encourage the eventual transition to v3. The proposal also noted that community members’ risk tolerance is currently lower. The proposal’s authors explained that the next step, where either delisting or relisting the markets can be chosen, will be based on the level of liquidity and usage.

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Game7 allocates $100M for Web 3.0 game companies

Blockchain game accelerator Game7 announced on November 28 that it would allocate $100 million in open-source technology grants to upcoming Web 3.0 initiatives. The distributions will support individuals/organizations building blockchain games, smart-contracts, core software infrastructures, and community tools, as Game7 stated. 

Game7 was created on November 18, 2021, as part of a $500 million blockchain ecosystem accelerator backed by BitDAO. Most of the funding came from the eponymous decentralized treasury. At the same time, Forte, Mirana Ventures, Warner Music Group, Aleo, Avalanche, Interchain Foundation, Off-chain Labs, OP Games, Polygon Studios, Solana Ventures, and the currently defunct Alameda Research participated in the seed round.

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