FTX US and BlockFi signed a deal by which the exchange will have the option to buy the lending firm for $240 million if shareholders approve. Only a year ago, BlockFi had been valued at $5 billion.
FTX US has inked a deal with BlockFi that will give the crypto derivatives exchange the option to purchase the lending firm.the crypto lending firm had signed agreements with FTX US for a $400-million revolving credit facility as well as the option to acquire BlockFi “at a variable price of up to $240 million based on performance triggers.” According to the CEO, the deal was reached as part of an effort “to bolster liquidity and protect client funds” at BlockFi.
The agreements are still subject to shareholder approval. Prince said volatility in the crypto market, “particularly market events related to Celsius and 3AC,” which had a negative impact on BlockFi, led to the decision. The crypto lending platform suffered roughly $80 million in losses the week following Celsius pausing withdrawals, and, after considering “various unattractive options” for recovery, partnered with FTX US.
“All of our products and services — including funding and withdrawals, our trading platform, credit card and global institutional services — continue to operate normally, with incremental capital strength behind them,” said Prince.1. A $400M revolving credit facility which is subordinate to all client funds, and— Zac Prince
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