Decentralized finance (DeFi) lending platform TrueFi has issued a notice of default against the South Korean blockchain investment firm Blockwater Technologies for failing to pay off its crypto debt. According to TrueFi, Blockwater failed to repay a $3.4 million loan in Binance USD (BUSD) stablecoin.
In a blog post on Monday, TrueFi said that they had offered Blockwater “an exhaustive out-of-court workout” to pay back the loan including “a loan amendment to increase the borrowing rate and extend maturity.” However, the DeFi lending platform ultimately decided to proceed with court-supervised administrative action in the interest of stakeholders given the complexity around the sudden insolvency.
TrueFi claimed that this is their only declared default to date, and that the credit group continues to remain “vigilant and proactive with existing borrowers to ensure that reporting and compliance requests are being promptly met”, given the bear phase in the crypto market. The crypto lender underlined the fact that “the Blockwater default does not affect lenders in TrueFi’s USDC, TUSD, USDT stablecoin lending pools, nor any of TrueFi’s capital market portfolios.”
Following the notice of default, TrueFi said Blockwater has successfully completed 8 payments totalling $645,405 towards loan repayment. After accounting for this, the remaining amount is $2,967,458. Additionally, TrueFi unveiled its unsecured loans amount of worth $1.7 billion out of which the lender has successfully collected $1.5 billion in repayments in all of its 136 loans outstanding, generating $34.34 million in interest for lenders.
On a positive note, TrueFi claimed that it was facilitating nearly $140 million of active lending across 10 loans. The DeFi lender said despite its first default case, the company’s loan book continues to remain in good shape and it has been actively pursuing loan renewals given continuing borrower demand and support from major lenders.