Troubled crypto lender BlockFi, whose ads for 9% returns recently adorned airports across the U.S., filed for Chapter 11 on Monday, the latest victim of FTX's sprawling fraud. The filing came as bad news for BlockFi's thousands of customers—its biggest creditors, owed $729 million—but also for billionaire Peter Thiel.
As the Wall Street Journal noted, a venture capital firm tied to Thiel called Valar Ventures (the name invokes god-like immortal spirits found in J.R.R. Tolkien books) owns 19% of BlockFi's shares. Those shares are now basically worthless since, under bankruptcy law, shareholders find themselves at the very back of the line after secured and unsecured creditors.
