TrueFi’s $3 million loan to South Korean startup Blackwater is in default

At the time of the default, TrueFi reported collecting around $645,000. The outstanding debt was estimated to be $2.96 million.

According to a blog post by unsecured lending service TrueFi, the South Korean investment company Blockwater failed to repay its $3.4 million loan.

According to on-chain data, Blockwater got a “notice of default” on October 6 after missing a scheduled payment for a BUSD stablecoin loan.

TrueFi reported collecting around $645k in eight repayments, with the outstanding debt projected to be $2.96 million as of the default date. The $3.4 million loan default represents about 2% of TrueFi’s Total Outstanding Value, according to the lender.

Given the adverse market circumstances, TrueFi’s credit group continues to be diligent and aggressive with current customers to ensure that reporting and compliance needs are quickly satisfied.

Originally, the loan had a 90-day maturity that expired in the first week of August. Later, as a result of talks between the two parties, the $3.4 million loan was restructured with an October maturity date and a weekly payback plan.

TrueFi enables crypto gamers to get loans without collateral. TrueFi’s borrowers are institutions that must pass Know Your Customer (KYC) processes in order to create a borrower pool.

In 2022, the failure of Blockwater is simply another illustration of the financial hardship encountered by several controlled crypto companies and lenders. Since the month of May, institutional players such as Three Arrows Capital and Celsius Network have defaulted on unsecured loans, causing widespread financial distress in the cryptocurrency industry.

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