The rumors that FTX would take over the troubled BlockFi had been around for some time. Initially, it was about an amount of 25 million dollars, which was immediately referred to the realm of myth by BlockFi CEO Zac Prince. Prince now shares via Twitter that BlockFi and FTX have reached an agreement on a takeover amount of up to 240 million dollars.
Huge discount for FTX
With this, FTX’s Sam Bankman-Fried could potentially be a major blow to his portfolio. In the last capital round of BlockFi, which dates from July 2021, the company was still valued at 4.8 billion dollars. In addition to the acquisition amount, BlockFi will also receive a 400 million dollar revolving credit from FTX. This brings an end to the painful month that BlockFi has been through.
According to CEO Zac Prince, BlockFi has suffered greatly from the problems at Celsius and Three Arrows Capital. While BlockFi had no exposure to either Celsius or Three Arrows Capital, it did feel the pain of the problems. This was mainly because customers lost confidence in crypto lending platforms en masse as a result and huge amounts of funds were also taken away from BlockFi.
Fusion with FTX
In the end, BlockFi has found a partner in FTX who must secure the future according to CEO Zac Prince. “Nothing changes at all for customers when it comes to current products […] the FTX US platform and its products complement BlockFi’s arsenal perfectly. We therefore expect an improvement of our services thanks to the collaboration”, says Prince about the developments.
In any case, with FTX as a partner, there is a mountain of capital behind BlockFi that makes it unlikely that they will go bankrupt in this market. That should in any case be a relief for the users. Unlike some other loan platforms, BlockFi continues to operate as usual. Which means that customers can simply withdraw their funds whenever they want.