On December 6, 2023, Muddy Waters released a report entitled, “Here Comes the Cliff!” shorting Blackstone. In this report, Muddy Waters stated, “[i]nterest rate swaps and manipulated risk ratings / loss provisions have obscured serious deterioration in BXMT’s loan book.” In addition, the report listed several problems that would be evident in the new year: (1) Blackstone will significantly cut its dividend; (2) a significant number of borrowers will unlikely be able to refinance and repay Blackstone; (3) Blackstone is at risk of a liquidity crisis; and (4) Blackstone’s losses on its net book value could potentially reach anywhere between $2.5 billion to $4.5 billion, resulting in its market cap being wiped out.

On this news, Blackstone’s stock price fell $1.81 per share, or 8.05%, to close at $20.68 per share on December 6, 2023.