BlockFi Will Be Acquired by FTX.US for Up to $240M

0
87
BlockFi Will Be Acquired by FTX.US for Up to $240M

BlockFi has confirmed that FTX.US will be acquiring the firm for up to $240 million.

BlockFi will also receive a $400 million rolling credit facility from FTX.US. 

BlockFi Inks Deal With FTX.US 

BlockFi has agreed to an acquisition deal with FTX.US. 

(Long thread!)

Excited to share an update on our previously announced term sheet with @FTX_US – and how we’ve broadened the scope of the initial deal for the benefit of all key @BlockFi stakeholders.

— Zac Prince (@BlockFiZac) July 1, 2022

The crypto lender’s CEO Zac Prince took to Twitter Friday to announce the update, revealing that FTX.US would be buying the firm for up to $240 million based on certain “performance triggers.” Prince added that BlockFi would receive a $400 million rolling credit facility (it was previously revealed on Jun. 21 that FTX had offered BlockFi a $250 million credit line). The $240 million price tag marks a heavy discount from BlockFi’s previous valuation. The firm was valued at $4.8 billion after it raised funds in a private round in July 2021.

The news of the $680 million deal comes off the back of a rocky June for BlockFi. Prince said that “​​crypto market volatility” had negatively impacted BlockFi in the lead-up to the deal. Though he cited the insolvency issues Celsius and Three Arrows Capital faced, he clarified that BlockFi had no exposure to either firm. Instead, he said, the impact of Three Arrows’ sudden collapse led to a wave of withdrawals as customers lost faith in lending services, sparking BlockFi’s own insolvency crisis. On Jun. 16, it was revealed that BlockFi was one of several firms to liquidate Three Arrows as it failed to meet a margin call when the market crashed. Prince said that the Three Arrows saga “spread fear” in the market, before revealing that BlockFi suffered losses of $80 million in the fallout.

Prince further added that while the firms had agreed to a $680 million deal, BlockFi had not utilized any of the credit line. He then went on to explain how the firm engages in risk management practices and that it “fundamentally [believes] in protecting customer funds.” Protecting customers, Prince explained, was a key reason to add capital to the firm’s balance sheet.

Similar to BlockFi, the crypto lender Celsius also faced insolvency issues in June, but it instead opted to freeze customer withdrawals. The firm’s crisis is still ongoing. Other crypto lenders such as Babel Finance and CoinFLEX have also faced insolvency issues in recent weeks amid extreme market turmoil.

This story is breaking and will be updated as further details emerge. 

The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.

You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.

See full terms and conditions.

FTX Could Soon Purchase Stake in BlockFi: Report

News

The popular crypto exchange FTX could soon purchase a stake in the lending firm BlockFi, according to the Wall Street Journal. FTX Is in Talks With BlockFi FTX and BlockFi…

FTX Could Soon Purchase Stake in BlockFi: Report

BlockFi CEO Denies Company Will Be Sold for $25M

BlockFi CEO Zac Prince denies that the company is being sold for $25 million. The crypto lender had previously been valued at $4.8 billion. 99.5% Discount? Zac Prince says BlockFi…

BlockFi CEO Denies Company Will Be Sold for $25M

BlockFi Raises Rates Three Days After FTX Bailout

BlockFi is raising the yield on its Bitcoin, Ethereum, and stablecoin lending products three days after FTX extended the company a $250 million revolving line of credit. The Powers of…

BlockFi Raises Rates Three Days After FTX Bailout

Read More

LEAVE A REPLY

Please enter your comment!
Please enter your name here