Crypto Lending Platform Accidentally Sends Users Millions of Dollars in Bitcoin

Crypto Lending Platform Accidentally Sends Users Millions of Dollars in Bitcoin

News
May 21, 2021 by J.D. Smith
71
Crypto lending firm BlockFi says it accidentally sent large amounts of Bitcoin (BTC) to some of its customers. Users began reporting the mixup last week, with one post on Reddit showing a 701 BTC “bonus payment” worth more than $25 million at time of publishing. The erroneous payments stem from a March trading campaign that

Crypto lending firm BlockFi says it accidentally sent large amounts of Bitcoin (BTC) to some of its customers.

Users began reporting the mixup last week, with one post on Reddit showing a 701 BTC “bonus payment” worth more than $25 million at time of publishing.

The erroneous payments stem from a March trading campaign that rewards clients who reach certain trading volume targets.

According to BlockFi, it intended to send Gemini dollars (GUSD) to clients who participated in their trading promotions, but it incorrectly transferred the amount in Bitcoin. 

The firm says some of its clients withdrew the BTC they received, and about $10 million is outstanding.

“A small edge case of approximately 100 clients were able to access the erroneous deposits and withdraw funds from the platform on May 17.

The company’s exposure is currently approximately $10M and decreasing quickly as clients are returning funds. We are incredibly grateful for our clients understanding the mistake and returning funds that did not belong to them.”

BlockFi says the outstanding amount is a small fraction of the reserves the company has allocated for loss.

Representatives also say the crypto that was erroneously sent is not connected to client funds, which are safe.

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