FTX Reportedly Planning To Buy Stake in Crypto Lending Firm BlockFi

FTX Exchange and BlockFi Agree on Mutual Acquisition Terms
  • The total sum being discussed has not been made public yet.
  • The company sold its stake in 3AC and reduced 20% of its personnel this month.

Wall Street Journal reports that well-known cryptocurrency exchange FTX is planning to buy a stake in lending company BlockFi. It seems that talks between the two corporations are underway, according to insiders. However, no decision has been taken, and the total sum being discussed has not been made public yet.

Desperately Needed Funding

A $250 million line of credit was granted to BlockFi earlier this week by FTX. The BlockFi CEO, Zac Prince, indicated that the financing would boost the company’s financial sheet and platform strength. The fact that BlockFi sought a loan despite Prince’s upbeat spin on the agreement suggests that the company may have money troubles. In addition, the company sold its stake in 3AC and reduced 20% of its personnel this month.

Rumors of low liquidity at BlockFi have been sparked by such occurrences. This might supply BlockFi with much-needed financing, as FTX’s probable move to buy a share could. The CEO of FTX, Sam Bankman-Fried, has invested in several other cryptocurrency firms.

Voyager Digital, a Canadian cryptocurrency brokerage, has sold a stake to Alameda Research, also led by Bankman-Fried. Also, this month, Alameda gave Voyager $200 million cash and a 15,000 BTC credit line. As Voyager attempts to recover from a failing loan agreement with Three Arrows Capital (3AC), these monies are likely to be used. Voyager has filed claims for $667 million.

As part of previous agreements this year, Bankman-Fried bought a 7.6% share in Robinhood for $648.3 million. This month, FTX.US purchased Embed Financial, while FTX purchased Bitvo. For the time being, FTX looks to be well-positioned. With a 24-hour trading volume of $2 billion, FTX is one of the leading exchanges out there.

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Content writer by profession. A crypto lover and has passion for writing. Follows the developments of digital currency right from its launch, years ago.