The South Korea-based crypto investment firm failed to make a payment on a $3.4 million loan to TrueFi, a decentralized lending protocol.

South Korean blockchain investment firm Blockwater Technologies defaulted on a loan from TrueFi, a decentralized lending protocol, TrueFi said in astatementSunday.

According to the statement, TrueFi issued a “notice of default” to Blockwater on Oct. 6 after it failed payment on a $3.4 millionloanin Binance USD (BUSD)stablecoin.

Blockwater’s default seems to be the latest example of the crypto industry’s insolvency crisis. This year’s dramatic downturn of crypto markets, exacerbated by theimplosion of the Terra blockchain, has led to the bankruptcy of multiple high-profile crypto firms, such as hedge fundThree Arrows Capital(3AC), crypto lenderCelsius Network, digital asset brokerVoyager Digitaland crypto-mining data center operatorCompute North.

Blockwater’s default on its debt came after TrueFi and Blockwaterrestructuredthe loan and extended the payment period in August. Blockwater managed to repay $654,000 of its outstanding debt after the restructuring efforts, but eventually missed payment. The remaining debt amounts to almost $3 million.

TrueFi determined that “a potential court-supervised administrative proceeding would lead to a better outcome for stakeholders given the complexity around the sudden insolvency,” according to the lending protocol’s statement.

“While we always prefer to pursue an out-of-court solution with distressed borrowers, in some instances an administrative proceeding is the best option in preserving value for stakeholders,” Roshan Daria, head of lending atArchBlock, which manages relationships between lenders and borrowers on the TrueFi protocol, told CoinDesk.

TrueFi remained in “active discussion” with Blockwater, and said that Blockwater’s insolvency does not affect the protocol’s other lending pools, per the statement.